Discontinued Operations
Certain operations are reported as discontinued in the Consolidated Statements of Earnings for the years ended December 31, 2013, 2012 and 2011.
Healthcare Benefit Solutions Business
On June 25, 2012, we entered into a definitive agreement to sell our Healthcare Benefit Solutions Business ("Healthcare Business") because its operations did not align with our strategic plans. The all-cash transaction closed on August 15, 2012 and we received cash proceeds of $332.2 million. We recorded a pre-tax gain of $22.0 million and tax expense on the sale of $78.3 million, which resulted from the allocation of goodwill with minimal tax basis.
The results of operations of the Healthcare Business, which were previously included in the PSG segment, have been classified as discontinued operations for all periods presented. The Healthcare Business had no revenues during the year ended December 31, 2013, and revenues of $80.5 million and $120.1 million during the years ended December 31, 2012 and 2011, respectively. The following table illustrates the results of operations for the years ended December 31, 2013, 2012 and 2011 for the Healthcare Business (in millions).
|
| | | | | | | | | | | |
| Years ended December 31, |
| 2013 | | 2012 | | 2011 |
Pre-tax income from operations | $ | 0.2 |
| | $ | 13.8 |
| | $ | 17.3 |
|
Pre-tax gain on sale | — |
| | 22.0 |
| | — |
|
Earnings before tax | 0.2 |
| | 35.8 |
| | 17.3 |
|
Tax expense | 0.1 |
| | 83.6 |
| | 6.6 |
|
Healthcare Benefit Solutions Business included in discontinued operations | $ | 0.1 |
| | $ | (47.8 | ) | | $ | 10.7 |
|
| | | | | |
Brazil Item Processing and Remittance Services Operations
During the third quarter of 2010, the Company decided to pursue strategic alternatives for Fidelity National Participacoes Ltda. (“Participacoes”). Participacoes' processing volume was transitioned to other vendors or back to its customers during the second quarter of 2011. Participacoes had no revenues for the years ended December 31, 2013 and December 31, 2012 and revenues of $11.7 million during the year ended December 31, 2011. Participacoes had expenses of $23.1 million, $47.5 million and $36.6 million during the years ended December 31, 2013, 2012 and 2011, respectively. As a result of the dismissal of employees related to the shut-down activities completed in 2011, the years ended December 31, 2013, 2012 and 2011 included charges of $15.7 million, $39.1 million and $34.6 million, respectively, to settle claims or increase our provision for potential labor claims. The shut-down activities involved the transfer and termination of approximately 2,600 employees. As of December 31, 2013, there are approximately 1,080 active labor claims. Former employees generally had up to two years from the date of termination to file labor claims, which extended through April 2013. Consequently, we have continued exposure on these active claims, which were not transferred with other assets and liabilities in the disposal. Our accrued liability for active labor claims, net of $15.2 million in court ordered deposits, is $29.2 million as of December 31, 2013. Any changes in the estimated liability related to these labor claims will be recorded as discontinued operations.
ClearPar
On January 1, 2010, FIS sold certain assets and liabilities constituting our ClearPar automated syndicated loan trade settlement business. Terms of the sale included an initial cash payment of $71.5 million at closing, with the potential for an additional contingent earn-out payment calculated as a function of the business' 2012 operating results. In May 2013, we recorded in discontinued operations a gain of $26.8 million ($16.7 million, net of tax) upon final determination and receipt of the earn-out payment.
