On October 2, 2023, the Company entered into a Call Option Agreement with Vantiva SA, a société anonyme organized under the Laws of France (Vantiva), pursuant to which the Company granted Vantiva a binding call option to acquire the Home segment and substantially all of the associated segment assets and liabilities, which was subsequently exercised and a Purchase Agreement signed on December 7, 2023, in exchange for (i) 134,704,669 shares of Vantiva common stock representing a 24.73% equity stake in Vantiva (determined on a fully diluted basis), (ii) $250,465 in cash (in addition to cash paid in exchange for the cash on the Home business companies’ balance sheets) and (iii) an earn-out of up to $100 million in the aggregate. The $250,465 in cash paid in connection with the closing was expected to be used to acquire additional shares of Vantiva common stock, following which the Company was expected to own a 25% equity stake in Vantiva (on a fully diluted basis). The earn-out payments are contingent on Vantiva achieving adjusted EBITDA equal to or greater than €400 million for one or more of Vantiva’s first five fiscal years following the closing of the transaction. The earn-out payment with respect to any fiscal year will be subject to an additional annual cap, the amount of which will depend on certain elections made by the Company following Vantiva reaching the €400 million adjusted EBITDA threshold for the first time, and on Vantiva’s maintenance of certain liquidity levels (after giving effect to such payment).

The Home business qualified as “held for sale” per ASC 360-10 in the fourth quarter of 2023 and was classified as a discontinued operation per ASC 205-20, as the Company determined, qualitatively and quantitatively, that this transaction represents a strategic shift that has or will have a major effect on the Company’s operations and financial results. As such, activity directly attributable to the Home business has been removed from continuing operations and presented in loss from discontinued operations, net of income taxes on the Consolidated Statements of Operations for all periods presented. In addition, all assets and liabilities of the Home business have been classified as assets and liabilities held for sale on the Consolidated Balance Sheets as of December 31, 2023 and 2022. In connection with the “held for sale” classification, the Company recognized a loss on classification as held for sale of $177.0 million, which has been included in loss from discontinued operations, net of income taxes on the Consolidated Statements of Operations for the year ended December 31, 2023.

Following the closing of this transaction, the Company’s ownership interest in Vantiva is expected to be reported as an equity method investment. In addition, the Company has also entered into a Supply Agreement, whereby the Company will sell certain retained inventory to Vantiva for a period of two years following the close of the transaction at market prices.

The following table presents the summarized components of loss from discontinued operations, net of income taxes:


	Year Ended December 31,
	2023			2022			2021
Net sales	$	1,210.2		$	1,703.4		$	1,849.4
Cost of sales		1,060.2			1,493.3			1,604.5
Gross profit		150.0			210.1			244.9
Operating expenses:
Selling, general and administrative		100.7			94.2			150.9
Research and development		98.3			113.8			118.2
Amortization of purchased intangible assets		83.4			103.0			103.0
Restructuring costs (credits), net		6.0			(0.1	)		6.8
Asset impairments		469.2			—			13.7
Total operating expenses		757.6			310.9			392.6
Operating loss		(607.6	)		(100.8	)		(147.7	)
Other income, net		1.0			0.5			2.5
Loss from discontinued operations before income taxes		(606.6	)		(100.3	)		(145.2	)
Loss on classification as held for sale		(177.0	)		—			—
Income tax (expense) benefit		184.0			(1.9	)		32.6
Loss from discontinued operations, net of income taxes	$	(599.6	)	$	(102.2	)	$	(112.6	)

The following table presents balance sheet information for assets and liabilities held for sale:


	December 31,
	2023			2022
Cash and cash equivalents	$	—		$	25.1
Accounts receivable, net		253.6			345.5
Inventories, net		118.4			212.1
Prepaid expenses and other		23.9			39.1
Other assets		59.7			—
Total current assets		455.6			621.8
Loss on classification of held for sale		(177.0	)		—
Total current assets held for sale		278.6			621.8
Property, plant, and equipment, net		—			8.6
Other intangible assets, net		—			558.5
Other noncurrent assets		—			33.7
Total noncurrent assets		—			600.8
Total assets held for sale	$	278.6		$	1,222.6

Accounts payable	$	192.5		$	341.2
Accrued and other liabilities		101.7			181.4
Other liabilities		13.0			—
Total current liabilities held for sale		307.2			522.6
Deferred income taxes		—			58.0
Other noncurrent liabilities		—			24.6
Total noncurrent liabilities		—			82.6
Total liabilities held for sale	$	307.2		$	605.2

The cash flows related to discontinued operations have not been segregated in the Consolidated Statements of Cash Flows, and accordingly, they include the results from continuing and discontinued operations. The following table summarizes significant non-cash operating items and capital expenditures of the discontinued operation included in the Consolidated Statements of Cash Flows:


	Year Ended December 31,
	2023		2022		2021
Significant non-cash operating items:
Depreciation and amortization	$	94.3	$	116.5	$	121.9
Equity-based compensation		3.7		5.8		8.8
Asset impairments (1)		646.2		—		13.7
Capital expenditures		2.4		4.0		5.6

(1)

Includes loss of $177.0 million on classification as held for sale and $469.2 million on impairment of long-lived assets.

The loss on classification as held for sale of $177.0 million recorded in the fourth quarter of 2023 reduced the carrying value of the Home business disposal group, comprised of all the assets and liabilities of the Home business, to its fair value less cost to sell. The Company estimated the fair value of the disposal group using Company-specific inputs, including estimates of consideration to be exchanged upon the close of the divestiture. The determination of the loss on classification as held for sale was based on Level 3 valuation inputs.

The Company also recorded a partial impairment of $469.2 million related to the Home segment's intangible assets during the third quarter of 2023. The Company estimated the fair value of the asset group using Company-specific inputs, including estimates of consideration to be received upon the impending divestiture, as well as other market participant assumptions. The determination of the impairment charge was based on Level 3 valuation inputs.