DuPont 2012 Annual Report Download - page 63

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(Dollars in millions, except per share)
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In January 2011, DuPont and its wholly owned subsidiary, DuPont Denmark Holding ApS (DDHA), entered into a definitive agreement with Danisco A/S
(Danisco), a global enzyme and specialty food ingredients company, for DDHA to make a public tender offer for all of Danisco's outstanding shares at a price
of 665 Danish Kroner (DKK) in cash per share. On April 29, 2011, DDHA increased the price of its tender offer to acquire all of the outstanding shares of
Danisco to DKK 700 in cash per share.
On May 19, 2011, the company acquired approximately 92.2 percent of Danisco's outstanding shares, excluding treasury shares, pursuant to the previously
announced tender offer. From May 19, 2011 to September 22, 2011, DuPont acquired all of Danisco's remaining outstanding shares. This acquisition has
established DuPont as a leader in industrial biotechnology with science-intensive innovations that address global challenges in food production and reduced
fossil fuel consumption. The Danisco acquisition was valued at $6,417, plus net debt assumed of $617.
As part of the Danisco acquisition, DuPont incurred $85 in transaction related costs during 2011, which were recorded in costs of goods sold and other
operating charges. In 2011, Danisco contributed net sales of $1,713 and net income attributable to DuPont of $(7), which excludes $30 after-tax ($39 pre-tax)
of additional interest expense related to the debt issued to finance the acquisition. Danisco's contributions included a $125 after-tax ($175 pre-tax) charge
related to the fair value step-up of inventories acquired and sold during 2011.
The following table summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date:
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Cash and cash equivalents $48
Accounts and notes receivable 1
522
Inventories 2709
Property, plant and equipment 1,709
Goodwill 32,891
Other intangible assets 42,859
Other current and non-current assets 78
Total assets acquired $8,816
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Accounts payable and other accrued liabilities
$ 489
Short-term borrowings 5342
Long-term borrowings 5323
Other liabilities 219
Deferred income taxes 61,026
Total liabilities assumed $2,399
1. The gross amount of accounts and notes receivable acquired was $531, of which $9 was expected to be uncollectible.
2. The fair value of inventories acquired included a step-up in the value of $175, which was expensed to cost of goods sold and other operating charges in 2011.
3. Goodwill will not be deductible for statutory tax purposes. Goodwill is attributable to Danisco's workforce and the synergies in technology, operations and market access that are
expected from the acquisition. Approximately $900 and $2,000 of goodwill was allocated to the Industrial Biosciences and Nutrition & Health segments, respectively.
4. Other intangible assets acquired of $1,002 are indefinite-lived (see Note 11).
5. Debt assumed has been paid off as of December 31, 2011.
6. The deferred income tax liabilities assumed represent the adjustments for the tax impact of fair value adjustments, primarily relating to definite-lived intangible assets.
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