Harbinger Group Inc.
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SEC Filings

10-Q
HRG GROUP, INC. filed this Form 10-Q on 08/09/2013
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The preliminary valuation of the assets acquired and liabilities assumed for the HHI Business, including a reconciliation to the preliminary valuation reported as of December 30, 2012, is as follows:
 
HHI Business Preliminary Valuation
 
TLM Taiwan Preliminary Valuation
 
 
 
Preliminary Valuation
 
December 30,
2012
 
June 30,
2013
 
Adjustments/reclassifications
 
June 30,
2013
Cash
$
17.4

 
$
0.8

 
$
5.8

 
$
24.0

Accounts receivable
104.6

 

 
4.4

 
109.0

Inventory
207.2

 
1.1

 
(2.4
)
 
205.9

Prepaid expenses and other
13.3

 
2.1

 
(4.2
)
 
11.2

Property, plant and equipment
104.5

 
36.8

 
(5.1
)
 
136.2

Intangible assets
470.0

 
17.1

 

 
487.1

Other long-term assets
3.1

 
0.1

 

 
3.2

Total assets acquired
920.1

 
58.0

 
(1.5
)
 
976.6

Accounts payable
130.1

 

 
8.0

 
138.1

Deferred tax liability - current
7.1

 

 

 
7.1

Accrued liabilities
37.5

 
0.2

 
0.1

 
37.8

Deferred tax liability - long-term
104.7

 
1.9

 
11.2

 
117.8

Other long-term liabilities
11.2

 
8.1

 
(2.2
)
 
17.1

Total liabilities assumed
290.6

 
10.2

 
17.1

 
317.9

Total identifiable net assets
629.5

 
47.8

 
(18.6
)
 
658.7

Non-controlling interests
(2.2
)
 

 
(2.2
)
 
(4.4
)
Goodwill
662.1

 
45.6

 
13.1

 
720.8

Total net assets acquired
$
1,289.4

 
$
93.4

 
$
(7.7
)
 
$
1,375.1


Since the preliminary valuation on December 30, 2012, Spectrum Brands recorded $45.6 of goodwill related to the acquisition of TLM Taiwan on April 8, 2013, and recorded adjustments to the preliminary valuation of assets and liabilities, excluding TLM Taiwan, resulting in a net increase to goodwill of $13.1. The preliminary goodwill increased $11.2 as a result of recording certain state and foreign valuation allowances against deferred tax assets, a decrease of $5.1 resulting from a reduction in certain property, plant and equipment asset values and a $2.4 decrease from a reduction in inventory asset values. The changes in estimates were the result of additional accounting information provided by Stanley Black & Decker during the period. Spectrum Brands believes that the information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but it is waiting for additional information necessary to finalize those fair values. Thus, the provisional measurements of fair value set forth above are subject to change further. Spectrum Brands expects to complete the purchase accounting process as soon as practicable but no later than one year from the acquisition date.
Preliminary Pre-Acquisition Contingencies Assumed
Spectrum Brands has evaluated and continues to evaluate pre-acquisition contingencies relating to the HHI Business that existed as of the acquisition date. Based on the evaluation to date, Spectrum Brands has preliminarily determined that certain pre-acquisition contingencies are probable in nature and estimable as of the acquisition date. Accordingly, Spectrum Brands has recorded its best estimates for these contingencies as part of the preliminary valuation of the assets and liabilities acquired for the HHI Business. Spectrum Brands continues to gather information relating to all pre-acquisition contingencies that it has assumed from the HHI Business. Any changes to the pre-acquisition contingency amounts recorded during the measurement period will be included in the final valuation and related amounts recognized. Subsequent to the end of the measurement period any adjustments to pre-acquisition contingency amounts will be reflected in the Company's Condensed Consolidated Statements of Operations.

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