Quarterly report pursuant to Section 13 or 15(d)

Business Combinations - Orbotech Preliminary Purchase Price Allocation (Details)

v3.19.3
Business Combinations - Orbotech Preliminary Purchase Price Allocation (Details) - USD ($)
Feb. 20, 2019
Dec. 24, 2018
Sep. 30, 2019
Jun. 30, 2019
Allocation        
Goodwill [1]     $ 2,263,689,000 $ 2,211,858,000
Common Stock        
Allocation        
Merger agreement, share price (in dollars per share) $ 108.26      
Orbotech        
Business Acquisition        
Cash for outstanding Orbotech shares [2] $ 1,901,948,000      
Fair value of KLA-Tencor common stock issued for outstanding Orbotech shares [3] 1,324,657,000      
Cash for Orbotech equity awards [4] 9,543,000      
Fair value of KLA-Tencor common stock issued to settle Orbotech equity awards [5] 6,129,000      
Stock options and RSUs assumed [6] 13,281,000      
Total purchase consideration 3,255,558,000      
Less: cash acquired (215,640,000)      
Total purchase consideration, net of cash acquired 3,039,918,000      
Allocation        
Accounts receivable, net 200,517,000      
Inventories 330,325,000      
Contract assets 63,181,000      
Other current assets 73,561,000      
Property, plant and equipment, net 102,197,000      
Goodwill 1,809,625,000      
Intangible assets 1,553,570,000      
Other non-current assets 73,179,000      
Accounts payable (53,015,000)      
Accrued liabilities (178,849,000)      
Other current liabilities [7] (69,449,000)      
Deferred tax liabilities [8] (777,838,000)      
Other non-current liabilities [7] (67,901,000)      
Non-controlling interest (19,185,000)      
Total purchase consideration $ 3,039,918,000      
Merger agreement, share price (in dollars per share) $ 38.86      
Shares of common stock issued in acquisition (in shares) 12,200,000      
Merger agreement, entity shares issues per acquiree share (in shares) 0.25      
Orbotech stock options vested and unsettled (in shares) 56,614      
Cash for outstanding Orbotech shares [2] $ 1,901,948,000      
Purchase consideration, liability incurred, payment term 4 years      
Contingent consideration, deferred cash payments $ 8,800,000   8,800,000  
Contingent consideration, earn-out 7,100,000   3,200,000  
Contingent consideration, current 4,300,000   4,300,000  
Contingent consideration, non-current $ 11,600,000   $ 7,700,000  
Orbotech        
Allocation        
Shares outstanding (in shares) 48,900,000      
Orbotech | Frontline        
Business Acquisition        
Cash for outstanding Orbotech shares   $ 85,000,000.0    
Allocation        
Percentage of outstanding shares acquired   50.00%    
Cash for outstanding Orbotech shares   $ 85,000,000.0    
Purchase consideration, liability incurred   $ 10,000,000.0    
Purchase consideration, liability incurred, payment term   4 years    
Cash earn-out, minimum   $ 5,000,000.0    
Cash earn-out, maximum   $ 20,000,000.0    
[1] No goodwill was assigned to the Other reporting unit, and accordingly was excluded in the table above.
[2] Represents the total cash paid to settle 48.9 million outstanding Orbotech shares as of February 20, 2019 at $38.86 per Orbotech share.
[3] Represents the fair value of 12.2 million shares of our common stock issued to settle 48.9 million outstanding Orbotech shares. KLA issued 0.25 shares for each Orbotech share. The fair value of KLA’s common stock was $108.26 per share on the Acquisition Date.
[4]
Represents primarily cash consideration for the settlement of the vested stock options and restricted stock units for which services were rendered by the employees of Orbotech prior to the closing, and a small portion for the settlement of fractional shares.
[5] Represents the fair value of share of 56,614 shares of KLA common stock issued to settle the vested Orbotech stock options. The fair value of KLA’s common stock was $108.26 per share on the Acquisition Date.
[6]
Represents the fair value of the assumed stock options and RSUs to the extent those related to services provided by the employee of Orbotech prior to closing. Also refer to Note 10, “Equity, Long-Term Incentive Compensation Plans and Non-Controlling Interest” of the Condensed Consolidated Financial Statements for additional information about assumed stock options and RSUs.
[7]
On December 24, 2018, Orbotech, as part of its strategy to invest in the high growth area of the software business within the Printed Circuit Boards (“PCB”) industry, acquired the remaining 50% shares of Frontline, which was prior to that accounted as an equity investee, from Mentor Graphics Development Services (Israel) Ltd. Orbotech acquired all of the joint venture interests it did not previously own for $85.0 million in cash on hand and agreed to pay an additional $10.0 million in cash over four years plus a cash earn-out of not less than $5.0 million and up to $20.0 million. The earn out amounts are based on revenues from a Frontline product currently under development. As of February 20, 2019, the estimated fair market values of the four-year cash payment and the earn-out were $8.8 million and $7.1 million, respectively, and these amounts have been included in current and non-current liabilities at $4.3 million and $11.6 million respectively.  As of September 30, 2019, the estimated fair market values of the four-year cash payment and the earn-out were $8.8 million and $3.2 million, respectively, and these amounts have been included in current and non-current liabilities at $4.3 million and $7.7 million respectively.
[8]
Primarily related to tax impact on the future amortization of intangible assets acquired and inventory fair value adjustments.