GE 2014 Annual Report Download - page 184

164 GE 2014 FORM 10-K
FINANCIAL STATEMENTS ACQUISITIONS & INTANGIBLE ASSETS
NOTE 8. ACQUISITIONS, GOODWILL AND OTHER INTANGIBLE ASSETS
ACQUISITIONS
Upon closing an acquisition, we estimate the fair values of assets and liabilities acquired and consolidate the acquisition as
quickly as possible. Given the time it takes to obtain pertinent information to finalize the acquired company’s balance sheet,
then to adjust the acquired company’s accounting policies, procedures, and books and records to our standards, it is often
several quarters before we are able to finalize those initial fair value estimates. Accordingly, it is not uncommon for our initial
estimates to be subsequently revised.
On June 20, 2014, GE’s offer to acquire the Thermal, Renewables and Grid businesses of Alstom for approximately €12,350
million (to be adjusted for the assumed net cash or liability at closing) was positively recommended by Alstom’s board of
directors. In addition, GE, Alstom and the French Government signed a memorandum of understanding for the formation of
three joint ventures in grid technology, renewable energy, and global nuclear and French steam power and Alstom will invest
approximately €2,600 million in these joint ventures. In the fourth quarter of 2014, Alstom completed its review of the proposed
transaction with the works council and obtained approval from its shareholders. Also in the fourth quarter of 2014, GE and
Alstom entered into an amendment to the original agreement where GE has agreed to pay Alstom a net amount of
approximately €260 million of additional consideration at closing. In exchange for this funding, Alstom has agreed to extend
the trademark licensing of the Alstom name from 5 years to 25 years as well as other contractual amendments. The proposed
transaction continues to be subject to regulatory approvals. The transaction is targeted to close in 2015.
On June 2, 2014, we acquired Cameron’s Reciprocating Compression division for $550 million. The division provides
reciprocating compression equipment and aftermarket services for oil and gas production, gas processing, gas distribution and
independent power industries. The division is included in our Oil & Gas segment. The preliminary purchase price allocation
resulted in goodwill of approximately $250 million and amortizable intangible assets of approximately $100 million. The
allocation of the purchase price will be finalized upon completion of post-closing procedures.
In the first quarter of 2014, we acquired several businesses in our Healthcare segment. On February 12, 2014, we acquired
API Healthcare (API) for $340 million in cash. API is a healthcare workforce management software and analytics solutions
provider. The preliminary purchase price allocation resulted in goodwill of approximately $280 million and amortizable
intangible assets of approximately $125 million. On March 21, 2014, we acquired certain Thermo Fisher Scientific Inc. life-
science businesses for $1,065 million in cash. The primary business acquired, Hyclone, is a leading manufacturer of products
used to support biopharmaceutical research and production. The preliminary purchase price allocation resulted in goodwill of
approximately $700 million and amortizable intangible assets of approximately $320 million. The allocation of purchase prices
will be finalized upon completion of post-closing procedures.
In August 2013, we acquired the aviation business of Avio S.p.A. (Avio) for $4,449 million in cash. We recorded a pre-tax
acquisition-related charge of $96 million related to the effective settlement of Avio’s pre-existing contractual relationships with
GE. Avio is a manufacturer of aviation propulsion components and systems and is included in our Aviation segment. The
purchase price allocation resulted in goodwill of $3,230 million and amortizable intangible assets of $1,817 million.
In July 2013, we acquired Lufkin Industries, Inc. (Lufkin) for $3,309 million in cash. Lufkin is a leading provider of artificial lift
technologies for the oil and gas industry and a manufacturer of industrial gears and is included in our Oil & Gas segment. The
purchase price allocation resulted in goodwill of $2,120 million and amortizable intangible assets of $997 million.