Acquisition

9 Months Ended

Jun. 30, 2023

Asset Acquisition [Abstract]

Acquisitions

Acquisitions

Centralsul Acquisition - On May 8, 2024, the Company acquired all the outstanding shares of Centralsul Ltda. (Centralsul), an auto appearance and fragrance manufacturer and distributor based in Southern Brazil (Centralsul Acquisition), which is expected to increase the Company's Auto Care presence in the region. The share purchase agreement (SPA) included a contractual purchase price of approximately $15, which was adjusted by Centralsul's outstanding debt, an indemnity holdback and working capital adjustments resulting in an initial cash payment of $10.6, which is subject to a post closing working capital adjustment. The indemnity holdback is approximately $2 and will be used to satisfy any indemnification claims or paid out over a contractual timeline through 2027. The SPA includes a potential earnout payment of up to approximately $5 if certain financial metrics are achieved during calendar year 2025. If achieved, the earnout will be paid in the second fiscal quarter of 2026.

The preliminary purchase price of the acquisition including the estimated earnout is $16.5. The Company has allocated the preliminary purchase price to the assets acquired and liabilities assumed, and has preliminarily recognized goodwill of $14.1, which is attributable to the workforce of the acquired business and the established distribution footprint of the Centralsul business in the region. This goodwill has been allocated to the Auto Care segment as of June 30, 2024. The Company is still finalizing income tax considerations associated with the acquisition.

Belgium Acquisition - On October 27, 2023, the Company acquired certain battery manufacturing assets in Belgium from Advanced Power Solutions Belgium NV (APS) for a contractual purchase price of EUR3.5 (Belgium Acquisition). The Company also acquired certain raw materials from APS, procured by APS on the Company's behalf to facilitate the transition, for a total acquisition purchase price of $11.6 (including value added taxes). The Company assumed a building lease and the production employees as part of the acquisition, and acquired these assets to provide a battery manufacturing location in Europe. The Company has preliminarily recorded $0.7 of goodwill in the Battery & Lights segment as of June 30, 2024, which is attributable to the workforce acquired. The Company is still finalizing income tax considerations associated with the acquisition.

Acquisition and Integration Costs - The Company recorded $1.6 and $4.9 of acquisition and integration costs during the quarter and nine months ended June 30, 2024, respectively. Costs of good sold included $0.2 and $3.1 recorded in the quarter and nine months ended June 30, 2024, respectively. The majority of this was recorded in the first fiscal quarter as the Company was awaiting the receipt of the raw materials procured on the Company's behalf by APS as part of the Belgium Acquisition. These costs were offset by $1.0 of income during the nine months ended June 30, 2024, recorded in Other items, net, from producing inventory for APS under a transaction services agreement (TSA) entered into at the closing of the transaction. No further income is expected from this TSA. The Company also recorded $1.4 and $2.8 of legal and diligence fees in Selling, general and administrative expenses related to acquisition and integration activities during the quarter and nine months ended June 30, 2024, respectively.

There were no acquisition and integration costs during the nine months ended June 30, 2023.