ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS | ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS ACQUISITIONS. Nihon Medi-Physics On March 31, 2025, the Company acquired the remaining 50% interest in Nihon Medi-Physics Co., Ltd (“NMP”) from joint venture partner Sumitomo Chemical for net cash consideration of $269 million. The acquisition was funded with cash on hand. NMP is a leading pharmaceutical manufacturer in Japan, focused on radiopharmaceuticals, which are used to enable clinical images across neurology, cardiology, and oncology procedures, as well as nonclinical and clinical development of radiotracers and theranostics research. Their product portfolio includes several GE HealthCare radiopharmaceuticals. NMP is included in the Company’s PDx segment. On March 31, 2025, the fair value of the Company’s existing 50% interest in NMP was determined to be $301 million based on the cash consideration exchanged for acquiring the remaining 50% equity interest. The carrying value of our 50% interest was $204 million. The Company recognized a net gain of $97 million resulting from this remeasurement to fair value. This gain included the reclassification of certain amounts related to the Company’s 50% interest out of Accumulated other comprehensive income (loss) – net (“AOCI”) including foreign currency translation gains of $63 million and losses related to a defined benefit pension plan of $8 million. The net gain from this remeasurement was recorded in Other (income) expense – net in the Company’s Condensed Consolidated Statements of Income for the three months ended March 31, 2025. The following table provides a summary of the purchase price consideration transferred for the acquisition of NMP.
The estimated fair values of the assets and liabilities assumed in connection with the acquisition of NMP are as follows.
(1) All other non-current assets includes $12 million of indemnification assets, with the underlying indemnified liabilities recorded in All other non-current liabilities. (2) Other includes Accounts payable, All other current liabilities, and Current compensation and benefits. The initial allocation of purchase price of NMP to the tangible and intangible assets acquired and liabilities assumed, as reflected in the table above, is based on the Company’s preliminary allocations of their fair values. The valuation of assets acquired and liabilities assumed has not yet been finalized as of March 31, 2025. While all amounts remain subject to adjustments, the areas subject to the most significant potential adjustments are property, plant, and equipment, intangible assets, decommissioning liabilities, and deferred income taxes. The preliminary valuation required estimates and assumptions including, but not limited to, estimating future cash flows and direct costs in addition to developing the appropriate discount rates. Accordingly, the purchase price adjustments are preliminary and are subject to further adjustments as additional information becomes available and as additional analyses are performed, and such further adjustments may be material. The Company’s management believes the fair values recognized for the assets acquired and the liabilities assumed are based on reasonable estimates and assumptions. Property, plant, and equipment is mostly comprised of land, buildings, equipment (including machinery, furniture, and fixtures) and construction in process. The fair value of property, plant, and equipment was determined using a market participant approach. Other intangibles relate to $200 million of definite-lived intangible assets and $23 million of acquired in-process research and development. Definite-lived intangible assets consist primarily of developed product market authorization rights and customer relationships. The acquired definite-lived intangibles are being amortized over a weighted-average estimated useful life of approximately 12 years. The estimated fair value of intangibles was determined using the income approach, which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of cash flows an asset would generate over its useful life. The goodwill associated with NMP, recorded within the PDx segment, is non-deductible for tax purposes and is attributed to expected synergies with NMP’s existing assets and workforce that are expected to allow the Company greater access and growth in the Japan market. Included in All other non-current liabilities are asset retirement obligations and decommissioning liabilities of $96 million, which were assumed in the transaction. NMP has a defined benefit pension plan which has pension assets of $73 million and pension liabilities of $34 million, a net asset of $39 million, which we acquired in the transaction and is included in All other non-current assets. Deferred income tax liabilities include the expected U.S. federal, state, and foreign tax consequences associated with temporary differences between the preliminary fair values of the assets acquired and liabilities assumed and the respective tax basis. Due to the proximity of the acquisition date to the end of the Company’s first quarter, the revenues and earnings of NMP are not significant to our consolidated results. If the acquisition of NMP had taken place as of the beginning of 2024, consolidated revenues and earnings would not have been significantly different than reported amounts. MIM Software On April 1, 2024, the Company acquired 100% of the stock of MIM Software Inc. (“MIM Software”) for approximately $259 million, net of cash acquired of $11 million, and potential contingent payments valued at $13 million pertaining to achievement of certain milestones, for a total preliminary purchase price of $283 million. The acquisition included up to $23 million of other contingent payments based on service requirements. The acquisition was funded with cash on hand. This transaction was accounted for as a business combination. The final purchase price allocation resulted in goodwill of $189 million, customer-related intangible assets of $52 million, developed technology intangible assets of $48 million, net deferred tax liabilities of $13 million, and other net assets of $7 million. The goodwill associated with the acquired business, recorded within the Imaging segment, is non-deductible for tax purposes and is attributed to expected synergies and commercial benefits from use of the MIM Software technology in our existing GE HealthCare portfolio. MIM Software is a global provider of medical imaging analysis and artificial intelligence (“AI”) solutions for the practice of radiation oncology, molecular radiotherapy, diagnostic imaging, and urology at imaging centers, hospitals, specialty clinics, and research organizations worldwide. Revenue and earnings of MIM Software included in the Company’s financial statements since the acquisition date are not material to our consolidated revenue and earnings. If the acquisition of MIM Software had taken place as of the beginning of 2023, consolidated revenues and earnings would not have been significantly different from reported amounts. GOODWILL.
We assess the possibility that a reporting unit’s fair value has been reduced below its carrying amount due to the occurrence of events or circumstances between annual impairment testing dates. We did not identify any reporting units that required an interim impairment test since the last annual impairment testing date. OTHER INTANGIBLE ASSETS.
(1) Indefinite-lived intangible assets relate to acquired in-process research and development prior to project completion and are not amortized. Amortization expense was $70 million and $80 million for the three months ended March 31, 2025 and 2024, respectively.
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| ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS | ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS ACQUISITIONS. Nihon Medi-Physics On March 31, 2025, the Company acquired the remaining 50% interest in Nihon Medi-Physics Co., Ltd (“NMP”) from joint venture partner Sumitomo Chemical for net cash consideration of $269 million. The acquisition was funded with cash on hand. NMP is a leading pharmaceutical manufacturer in Japan, focused on radiopharmaceuticals, which are used to enable clinical images across neurology, cardiology, and oncology procedures, as well as nonclinical and clinical development of radiotracers and theranostics research. Their product portfolio includes several GE HealthCare radiopharmaceuticals. NMP is included in the Company’s PDx segment. On March 31, 2025, the fair value of the Company’s existing 50% interest in NMP was determined to be $301 million based on the cash consideration exchanged for acquiring the remaining 50% equity interest. The carrying value of our 50% interest was $204 million. The Company recognized a net gain of $97 million resulting from this remeasurement to fair value. This gain included the reclassification of certain amounts related to the Company’s 50% interest out of Accumulated other comprehensive income (loss) – net (“AOCI”) including foreign currency translation gains of $63 million and losses related to a defined benefit pension plan of $8 million. The net gain from this remeasurement was recorded in Other (income) expense – net in the Company’s Condensed Consolidated Statements of Income for the three months ended March 31, 2025. The following table provides a summary of the purchase price consideration transferred for the acquisition of NMP.
The estimated fair values of the assets and liabilities assumed in connection with the acquisition of NMP are as follows.
(1) All other non-current assets includes $12 million of indemnification assets, with the underlying indemnified liabilities recorded in All other non-current liabilities. (2) Other includes Accounts payable, All other current liabilities, and Current compensation and benefits. The initial allocation of purchase price of NMP to the tangible and intangible assets acquired and liabilities assumed, as reflected in the table above, is based on the Company’s preliminary allocations of their fair values. The valuation of assets acquired and liabilities assumed has not yet been finalized as of March 31, 2025. While all amounts remain subject to adjustments, the areas subject to the most significant potential adjustments are property, plant, and equipment, intangible assets, decommissioning liabilities, and deferred income taxes. The preliminary valuation required estimates and assumptions including, but not limited to, estimating future cash flows and direct costs in addition to developing the appropriate discount rates. Accordingly, the purchase price adjustments are preliminary and are subject to further adjustments as additional information becomes available and as additional analyses are performed, and such further adjustments may be material. The Company’s management believes the fair values recognized for the assets acquired and the liabilities assumed are based on reasonable estimates and assumptions. Property, plant, and equipment is mostly comprised of land, buildings, equipment (including machinery, furniture, and fixtures) and construction in process. The fair value of property, plant, and equipment was determined using a market participant approach. Other intangibles relate to $200 million of definite-lived intangible assets and $23 million of acquired in-process research and development. Definite-lived intangible assets consist primarily of developed product market authorization rights and customer relationships. The acquired definite-lived intangibles are being amortized over a weighted-average estimated useful life of approximately 12 years. The estimated fair value of intangibles was determined using the income approach, which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of cash flows an asset would generate over its useful life. The goodwill associated with NMP, recorded within the PDx segment, is non-deductible for tax purposes and is attributed to expected synergies with NMP’s existing assets and workforce that are expected to allow the Company greater access and growth in the Japan market. Included in All other non-current liabilities are asset retirement obligations and decommissioning liabilities of $96 million, which were assumed in the transaction. NMP has a defined benefit pension plan which has pension assets of $73 million and pension liabilities of $34 million, a net asset of $39 million, which we acquired in the transaction and is included in All other non-current assets. Deferred income tax liabilities include the expected U.S. federal, state, and foreign tax consequences associated with temporary differences between the preliminary fair values of the assets acquired and liabilities assumed and the respective tax basis. Due to the proximity of the acquisition date to the end of the Company’s first quarter, the revenues and earnings of NMP are not significant to our consolidated results. If the acquisition of NMP had taken place as of the beginning of 2024, consolidated revenues and earnings would not have been significantly different than reported amounts. MIM Software On April 1, 2024, the Company acquired 100% of the stock of MIM Software Inc. (“MIM Software”) for approximately $259 million, net of cash acquired of $11 million, and potential contingent payments valued at $13 million pertaining to achievement of certain milestones, for a total preliminary purchase price of $283 million. The acquisition included up to $23 million of other contingent payments based on service requirements. The acquisition was funded with cash on hand. This transaction was accounted for as a business combination. The final purchase price allocation resulted in goodwill of $189 million, customer-related intangible assets of $52 million, developed technology intangible assets of $48 million, net deferred tax liabilities of $13 million, and other net assets of $7 million. The goodwill associated with the acquired business, recorded within the Imaging segment, is non-deductible for tax purposes and is attributed to expected synergies and commercial benefits from use of the MIM Software technology in our existing GE HealthCare portfolio. MIM Software is a global provider of medical imaging analysis and artificial intelligence (“AI”) solutions for the practice of radiation oncology, molecular radiotherapy, diagnostic imaging, and urology at imaging centers, hospitals, specialty clinics, and research organizations worldwide. Revenue and earnings of MIM Software included in the Company’s financial statements since the acquisition date are not material to our consolidated revenue and earnings. If the acquisition of MIM Software had taken place as of the beginning of 2023, consolidated revenues and earnings would not have been significantly different from reported amounts. GOODWILL.
We assess the possibility that a reporting unit’s fair value has been reduced below its carrying amount due to the occurrence of events or circumstances between annual impairment testing dates. We did not identify any reporting units that required an interim impairment test since the last annual impairment testing date. OTHER INTANGIBLE ASSETS.
(1) Indefinite-lived intangible assets relate to acquired in-process research and development prior to project completion and are not amortized. Amortization expense was $70 million and $80 million for the three months ended March 31, 2025 and 2024, respectively.
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