Acquisition

6 Months Ended

Jun. 27, 2021

Business Combination and Asset Acquisition [Abstract]

Acquisition

Acquisition

On June 18, 2021, the Company acquired Marisat, Inc. d/b/a Auto Exchange ("Auto Exchange"), a salvage auction provider located in New Jersey. The estimated acquisition date fair value of the total consideration was $7.3 million, which consisted of $2.0 million of cash, and the fair value of contingent consideration of $5.3 million, $2.0 million of which was paid at closing. The remaining $3.3 million of contingent consideration is payable over five years subject to the achievement of certain performance targets.

The Company has recorded provisional amounts for the fair value of contingent consideration and the acquired net assets associated with the transaction as the determination of their respective fair values has not been finalized. The purchase price was provisionally allocated to acquired customer relationships of $4.1 million and other acquired net assets of $0.7 million. The $2.5 million excess of the purchase price consideration over the estimated fair value of the acquired net assets was recognized as goodwill which reflects expected synergies resulting from adding Auto Exchange's products and processes to the Company's products and processes. The acquired goodwill is allocated to the United States segment and is deductible for tax purposes.

The results of Auto Exchange are included in the Company's financial statements since the date of acquisition and did not have a material impact on the Company's financial statements and related disclosures for the three and six months ended June 27, 2021. The costs incurred by the Company in connection with the Auto Exchange acquisition were not material.