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ACQUISITION
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
ACQUISITION ACQUISITION
On August 1, 2025, the Company acquired 100% of Swedish Electromagnet Invest AB (SEM) for $46 million, comprised of $14 million of cash consideration and $32 million cash used to extinguish debt assumed through the acquisition (the SEM Acquisition). During the three months ended June 30, 2026, the Company reduced the purchase consideration associated with the SEM Acquisition by $1 million as a result of the resolution of certain acquisition-related matters. The adjustment resulted in a corresponding decrease to goodwill. SEM is part of the Fuel Systems segment, and is a provider of advanced natural gas, hydrogen and other alternative fuel ignition systems, injector stators and linear position sensors.
The SEM Acquisition was accounted for as a business combination, with the purchase price, net of cash acquired, allocated on a preliminary basis as of August 1, 2025. The preliminary allocation of the purchase price to acquired assets and liabilities assumed, including the residual amount recognized as goodwill, is based upon estimated information and is subject to change within the measurement period. The measurement period is a period not to exceed one year from the acquisition date during which the Company may adjust estimated or provisional amounts recorded during purchase accounting if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in revised estimated values of those assets or liabilities as of that date. Measurement period adjustments are recorded in the period identified. The Company is in the process of finalizing all purchase accounting adjustments. Certain estimated values for the acquisition, including goodwill, intangible assets and deferred taxes are not yet finalized, and the preliminary purchase price allocations are subject to change as the Company completes its analysis of the fair value at the date of acquisition. The final valuation of assets acquired and liabilities assumed may be materially different from the estimated values shown below.
The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed as of the date of acquisition:
(in millions)Initial Purchase Price Allocation
Total purchase consideration(1)
$14 
ASSETS
Cash and cash equivalents$6 
Property, plant and equipment, net5 
Other intangible assets, net27 
Other assets25 
Total assets acquired$63 
LIABILITIES
Long-term debt$33 
Other liabilities19 
Total liabilities assumed$52 
Net assets acquired$11 
Goodwill(2)
$3 
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1 Total purchase consideration excludes cash paid of $32 million used to extinguish debt assumed through the SEM Acquisition.
2 Goodwill is not deductible for tax purposes.
The preliminary valuation of intangible assets consisted of the following assets subject to amortization (in millions, except weighted-average useful life):
Fair ValueWeighted-Average Useful LifeValuation MethodologyKey Assumptions
Customer relationships$18 12 yearsMulti-period excess earningsDiscount rate, customer attrition rate
Patented and unpatented technology96 yearsRelief-from-royaltyRoyalty rate, discount rate, obsolescence factor
The purchase price, net of cash acquired, was allocated based on the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition with the excess purchase price recorded as goodwill, all of which was allocated to the Fuel Systems segment. The goodwill is primarily the result of expected synergies as well as enhancing the Company’s product portfolio and strategy, enabling the Company to explore adjacent market opportunities to increase Fuel Systems sales globally. Amortization expense of purchased intangible assets is primarily recognized on a straight-line basis.