Acquisitions

3 Months Ended

Jun. 30, 2022

Business Combination and Asset Acquisition [Abstract]

Acquisitions

ACQUISITIONS

Acquisition of Cultec - On April 29, 2022, the Company completed its acquisition of Cultec, Inc. (“Cultec”). Cultec was a family-owned technology leader in the stormwater and onsite septic wastewater industries. The acquisition of Cultec expands the Company’s portfolio of innovative water management solutions in the stormwater and onsite septic wastewater industries. The total fair value of consideration transferred was $47.5 million.

The following table summarizes the consideration transferred and the preliminary purchase price allocation of assets acquired and liabilities assumed. The purchase price allocation for assets acquired and liabilities assumed is preliminary and will be finalized when valuations are complete and final assessments of the fair value of acquired assets and assumed liabilities are completed. Such finalization may result in material changes from the preliminary purchase price allocation. The Company's estimates and assumptions are subject to change during the measurement

period (up to one year from the closing date), as the Company continues to finalize the valuations of assets acquired and liabilities assumed.

(Amounts in thousands)	Initial Amount
Accounts receivable	$	5,957
Inventory	4,469
Intangible assets	31,400
Goodwill	9,660
Property, plant and equipment	1,986
Accounts payable	(5,539)
Accrued expenses	(75)
Other liabilities	(366)
Total fair value of consideration transferred	$	47,492

The preliminary goodwill of $9.7 million represents the excess of consideration transferred over the preliminary fair value of assets acquired and liabilities assumed and is attributable to expected operating efficiencies. The goodwill is deductible for income tax purposes and is assigned to Allied Products & Other.

The preliminary purchase price excludes transaction costs. During the three months ended June 30, 2022, the Company incurred $1.5 million of transaction costs related to the acquisition such as legal, accounting, valuation and other professional services. These costs are included in selling, general and administrative expenses in the Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income.

The identifiable intangible assets recorded in connection with the closing of the acquisition of Cultec are based on preliminary valuations including customer relationships, patents and developed technology and tradename and trademarks totaling $31.4 million.

(Amounts in thousands)	Preliminary fair value
Customer relationships	$	2,800
Patents and developed technology	16,200
Tradename and trademarks	12,400
Total identifiable intangible assets	$	31,400

The Company has excluded certain disclosures required under ASC 805, Business Combinations as they are not material to the financial statements.