Discontinued Operations | 3. Discontinued Operations Planned Disposition of Semiconductor Automation Business On September 20, 2021, the Company entered into a definitive agreement to sell its semiconductor automation business to THL. On February 1, 2022, subsequent to the close of our first fiscal quarter of 2022, the Company completed the sale of the semiconductor automation business for $3.0 billion in cash, subject to working capital and other customary adjustments. The Company expects net cash proceeds from the sale to be approximately $2.4 billion, after adjustments, taxes and other items. The semiconductor automation business is comprised of the Semiconductor Solution Group segment. Following the completion of the sale, the Company no longer serves the semiconductor market. In connection with the closing of the sale, the Company and THL entered into a transition services agreement, to which both the Company and THL will provide each other with certain transition services related to finance and accounting, information technology, human resources, compliance, facilities, legal and research and development support, for time periods ranging from three . In addition, the Company entered into two separate lease agreements for leases back to the Company for portions of the facilities that have served as its corporate headquarters in Chelmsford, Massachusetts, and were sold to THL as part of the sale agreement. Each lease provides for a term of 24 months , which may be terminated earlier by the Company upon 90 days ’ notice to THL. During the fourth quarter of fiscal 2021, the Company determined that the semiconductor automation business met the criteria to be classified as a discontinued operation and, as a result, its historical financial results are reflected in the Company’s financial statements as a discontinued operation, and assets and liabilities were classified as assets and liabilities held for sale. The following table presents the financial results of discontinued operations with respect to the semiconductor automation business (in thousands): Three Months Ended December 31, 2021 2020 Revenue Products $ 188,240 $ 118,154 Services 15,430 13,207 Total revenue 203,670 131,361 Cost of revenue Products 107,597 68,777 Services 8,309 6,791 Total cost of revenue 115,906 75,568 Gross profit 87,764 55,793 Operating expenses Research and development 13,740 10,994 Selling, general and administrative 22,676 14,099 Restructuring charges - 127 Total operating expenses 36,416 25,220 Operating income 51,348 30,573 Other income (loss), net (46) (1,239) Income before income taxes 51,302 29,334 Income tax provision 10,840 6,012 Net income from discontinued operations $ 40,462 $ 23,322 On July 1, 2019, the Company sold its semiconductor cryogenics business. During the first quarter of fiscal year ended 2021, the Company recorded a $1.3 million negative working capital adjustment to the gain on divestiture that was previously recorded in the fourth fiscal quarter of 2019. This adjustment is shown within Other income (loss), net within the income statement for the semiconductor automation business. The following table presents the significant non-cash items and capital expenditures for the discontinued operations with respect to the semiconductor automation business that are included in the Consolidated Statements of Cash Flows (in thousands): December 31, 2021 2020 Depreciation and amortization $ - $ 2,019 Capital expenditures $ 2,283 $ 1,827 Stock-based compensation 4,923 1,875 The carrying value of the assets and liabilities of the discontinued operations with respect to the semiconductor automation business on the Consolidated Balance Sheets as of December 31, 2021 and September 30, 2021 was as follows (in thousands): December 31, 2021 September 30, 2021 Assets Cash and cash equivalents $ 45,000 $ 45,000 Accounts receivable, net 133,578 142,256 Inventories 132,010 110,735 Other current assets 13,945 13,394 Total current assets of discontinued operation $ 324,533 $ 311,385 Property, plant and equipment, net $ 34,457 $ 32,058 Long-term deferred tax assets 2,518 3,167 Goodwill 81,514 81,477 Intangibles, net 44,576 44,468 Other assets 23,097 22,658 Total long-term assets of discontinued operation $ 186,162 $ 183,828 Liabilities Accounts payable $ 65,285 $ 68,074 Deferred revenue 8,160 7,141 Accrued warranty and retrofit costs 5,912 6,081 Accrued compensation and benefits 20,963 18,144 Accrued Income Taxes 6,184 11,702 Accrued expenses and other current liabilities 14,454 18,014 Total current liabilities of discontinued operation $ 120,958 $ 129,156 Long-term tax reserves 2,373 2,356 Long-term deferred tax liabilities 6,716 6,548 Long-term pension liabilities 5,547 5,490 Long-term operating lease liabilities 15,837 15,425 Other long-term liabilities 1,503 2,625 Total long-term liabilities of discontinued operation $ 31,976 $ 32,444 Acquisition within the Semiconductor Automation Business On April 29, 2021, the Company acquired Precise Automation Inc., a leading developer of collaborative robots and automation subsystems headquartered in Fremont, California. The total cash purchase price for the acquisition was approximately $69.8 million. Precise provides the semiconductor automation business with a product offering and technology portfolio to take advantage of the opportunities in the collaborative robot market. The allocation of the consideration included $38.7 million of technology, $2.5 million of customer relationships, $33.1 million of goodwill, $6.2 million of deferred tax liabilities, and several other assets and liabilities. The purchase price allocation was based on a preliminary valuation which is subject to further adjustments within the measurement period when additional information becomes available. The Company applied variations of the income approach to estimate the fair values of the intangible assets acquired. The completed technology was valued using excess earnings method and the customer relationships was valued using distributor margin method, both of which have a useful life of 11 years. The intangible assets acquired are amortized over the total weighted average period of 11 years using methods that approximate the pattern in which the economic benefits are expected to be realized. The Company has included the financial results of the acquired operations within income from discontinued operations on its Consolidated Statements of Operations. The goodwill and intangible assets are not The Company did not present a pro forma information summary for its consolidated results of operations because such results were immaterial. |