On December 1, 2021, the Company’s Steel Processing reportable operating segment completed its acquisition of Tempel Steel Company (“Tempel”), a leading global manufacturer of precision motor and transformer laminations for the electrical steel market that includes transformers, machine motors and electric vehicle (EV) motors for cash consideration of $289,609,000, plus the assumption of certain long-term liabilities. The acquisition was funded primarily with cash on hand and some borrowing from the Company’s Credit Facility. Total acquisition-related expenses were $1,924,000.

The information included herein has been based on the preliminary allocation of the purchase price using estimates of the fair value and useful lives of the assets acquired. The purchase price allocation is subject to further adjustment until all pertinent information regarding the assets acquired is fully evaluated by the Company, including but not limited to, the fair value accounting.

The assets acquired and liabilities assumed were recognized at their estimated acquisition-date fair values, with goodwill representing the excess of the purchase price over the fair value of the net identifiable assets acquired. In connection with the acquisition of Tempel, the Company identified and valued the following intangible assets:

(in thousands)
Category	Amount		Useful Life (Years)
Customer relationships	$	30,000	17
Technological know how		11,000	6-8
Total acquired identifiable intangible assets	$	41,000

The purchase price includes the fair values of other assets that were not identifiable, not separately recognizable under accounting rules (e.g., assembled workforce) or of immaterial value. The purchase price also includes strategic and synergistic benefits (investment value) specific to us, which resulted in a purchase price in excess of the fair value of the identifiable net assets. This additional investment value resulted in goodwill which is not expected to be deductible for income tax purposes. The purchase price was allocated as follows:

(in thousands)	Preliminary Valuation
Cash	$	17,098
Accounts receivable		88,672
Inventories		59,927
Other current assets		10,666
Property, plant and equipment		147,441
Intangible assets		41,000
Operating lease assets		4,098
Total identifiable assets		368,902
Accounts payable		(49,777	)
Notes payable		(6,270	)
Accrued liabilities		(17,501	)
Current operating lease liabilities		(1,614	)
Noncurrent operating lease liabilities		(2,484	)
Other non-current liabilities ⁽¹⁾		(40,110	)
Net identifiable assets		251,146
Goodwill		38,463
Purchase price	$	289,609

Operating results of Tempel have been included in the Company’s consolidated statement of earnings since December 1, 2021, the date of acquisition. During the three months ended February 28, 2022, Tempel contributed net sales of $129,463,000 and operating income of $1,844,000, which included acquisition-related costs of approximately $1,200,000 and incremental cost of goods sold of $3,820,000 due to the write-up of inventory to its estimated acquisition-date fair value.

The following unaudited pro forma information presents consolidated financial information as if Tempel had been acquired at the beginning of fiscal 2021. Depreciation and amortization expense included in the pro forma results reflect the preliminary acquisition-date fair values assigned to the definite-lived intangible assets and fixed assets of Tempel assuming a June 1, 2020 acquisition date. Adjustments have been made to remove acquisition-related costs and the acquisition date fair value adjustment to acquired inventories. The pro forma adjustments noted above have been adjusted for the applicable income tax impact. The pro forma information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place on June 1, 2020.

	Three months ended				Nine months ended
	February 28,				February 28,
(in thousands, except per share amounts)	2022		2021		2022		2021
Net sales	$	1,378,235	$	836,553	$	3,960,792	$	2,414,865
Net earnings attributable to controlling interest	$	60,062	$	65,564	$	318,185	$	606,384
Diluted earnings per share attributable to controlling interest	$	1.19	$	1.23	$	6.21	$	11.21

On June 8, 2021, the Company’s Steel Processing reportable operating segment, along with the Company’s 55% consolidated joint venture TWB Company, L.L.C. (“TWB”), acquired certain assets of the Shiloh Industries’ U.S. BlankLight® business (“Shiloh”), a provider of laser welded solutions. The purchase price for the acquisition was cash consideration of approximately $104,750,000, subject to closing adjustments. The Shiloh business is being primarily operated by TWB and as part of the Steel Processing segment and its operating results have been included in the Company’s consolidated statement of earnings since the date of acquisition. Proforma results, including the acquired business since the beginning of fiscal 2021, would not be materially different than the reported results.

The acquisition consisted of three laser welding facilities that are being operated as part of our TWB joint venture and one blanking facility that is operated as part of our core Steel Processing operations. Approximately $20,000,000 of the total goodwill relates to TWB, which will be treated as a separate reporting unit for purposes of goodwill impairment testing going forward.

The assets acquired and liabilities assumed were recognized at their estimated acquisition-date fair values, with goodwill representing the excess of the purchase price over the fair value of the net identifiable assets acquired. In connection with the acquisition of Shiloh, the Company identified and valued the following intangible assets:

(in thousands)
Category	Amount		Useful Life (Years)
Customer relationships	$	34,500	15-20
Non-compete agreement		290		3
In-process research & development		1,300	Indefinite
Total acquired identifiable intangible assets	$	36,090

The following table summarizes the consideration transferred and the estimated fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, including preliminary work performed by a third-party valuation specialist, and are subject to change within the measurement period as the valuation is finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of acquired tangible assets and liabilities, identification and valuation of residual goodwill and tax effects of acquired assets and assumed liabilities.

(in thousands)	Preliminary Valuation			Measurement Period Adjustments			Revised Valuation
Accounts receivable	$	44,191		$	-		$	44,191
Inventories		13,971			732			14,703
Property, plant and equipment		30,461			(119	)		30,342
Intangible assets		34,280			1,810			36,090
Operating lease assets		59,905			-			59,905
Total identifiable assets		182,808			2,423			185,231
Accounts payable		(44,822	)		-			(44,822	)
Current operating lease liabilities		(1,555	)		-			(1,555	)
Noncurrent operating lease liabilities		(58,350	)		-			(58,350	)
Net identifiable assets		78,081			2,423			80,504
Goodwill		26,669			(2,423	)		24,246
Purchase price	$	104,750		$	-		$	104,750