Note 14 – Acquisitions and Divestitures


We paid $269 million and $259 million in 2013 and 2012 for acquisition activities. Acquisitions in 2013 primarily related to the acquisition of Amor Group, a United Kingdom-based company specializing in information technology, civil government services, and the energy market and has been included in our IS&GS business segment. Acquisitions in 2012 primarily related to the acquisitions of Chandler/May, CDL, and Procerus, and each has been included within our MST business segment. These companies specialize in the design, development, manufacturing, control, and support of advanced unmanned systems. In 2011, we paid $624 million for acquisition activities including the acquisitions of QTC Holdings Inc. (QTC), which provides outsourced medical evaluation services to the U.S. Government, and Sim-Industries B.V. (Sim-Industries), a commercial aviation simulation company. QTC has been included within our IS&GS business segment, and Sim-Industries has been included within our MST business segment.

We have accounted for the acquisitions of businesses under the acquisition method, which required us to measure all of the assets acquired and liabilities assumed at their acquisition-date fair values. Purchase allocations related to the acquisitions discussed above resulted in recording goodwill aggregating $175 million in 2013, $197 million in 2012, and $547 million in 2011. Of the amounts recorded in 2012 and 2011, $69 million and $113 million will be amortized for tax purposes. Additionally, purchase allocations related to the 2011 acquisitions above resulted in recording $133 million of other intangible assets, primarily relating to the value of customer relationships and trade names we acquired.


Discontinued operations for 2013 included a benefit of $31 million resulting from the resolution of certain tax matters related to a business previously sold. Discontinued operations for 2011 included the operating results and other adjustments of Savi Technology, Inc. (Savi), a logistics business sold in 2012 that was in our former Electronic Systems business segment, and Pacific Architects and Engineers, Inc. (PAE), a business sold in 2011 that was formerly within our IS&GS business segment.

Net sales and operating loss from discontinued operations for the year ended December 31, 2011 were $193 million and $28 million (net of $12 million of income tax benefit). Additionally, net loss from discontinued operations for 2011 includes the recognition of a deferred tax asset of $66 million, which we were required to record to reflect the tax benefit that we expected to realize on the sale of Savi because our tax basis was higher than our book basis, and charges associated with Savi and PAE that were incurred in 2011.