9.	Acquisitions

During 2015, the Company acquired one company in the Electrical/Electronic Materials Group, three companies in the Office Products Group, four companies in the Industrial Group, and five store groups in the Automotive Parts Group for approximately $120,000,000, net of cash acquired. During 2014, the Company acquired two companies each in the Automotive Group, Office Products Group, and Electrical/Electronic Materials Group and one company in the Industrial Group for approximately $260,000,000, net of cash acquired. During 2013, the Company acquired one company each in the Automotive Group (including GPC Asia Pacific), Industrial Group, and Electrical/Electronic Materials Group for approximately $650,000,000, net of cash acquired.

For each acquisition, the Company allocated the purchase price to the assets acquired and the liabilities assumed based on their fair values as of their respective acquisition dates. The results of operations for the acquired companies were included in the Company’s consolidated statements of income and comprehensive income beginning on their respective acquisition dates. The Company recorded approximately $90,000,000, $200,000,000 and $950,000,000 of goodwill and other intangible assets associated with the 2015, 2014, and 2013 acquisitions, respectively.

For the 2015 acquisitions, other intangible assets acquired consisted of customer relationships of $39,000,000 with weighted average amortization lives of 15 years. For the 2014 acquisitions, other intangible assets acquired consisted of customer relationships of $82,000,000 and trademarks of $28,000,000 with weighted average amortization lives of 18 and 40 years, respectively. For the 2013 acquisitions, other intangible assets acquired consisted of customer relationships of $235,000,000, trademarks of $141,000,000, and non-competition agreements of $4,000,000 with weighted average amortization lives of 15, 40, and 1 years, respectively.

Additional disclosure on the 2013 automotive acquisition of GPC Asia Pacific is provided below.

GPC Asia Pacific

The Company acquired a 30% investment in GPC Asia Pacific, formerly known as the Exego Group, for approximately $166,000,000 effective January 1, 2012. On April 1, 2013, the Company acquired the remaining 70% interest in GPC Asia Pacific for approximately $590,000,000, net of cash acquired of $70,000,000, and the assumption of approximately $230,000,000 in debt. The acquisition was financed using a combination of cash on hand and borrowings under existing credit facilities. GPC Asia Pacific, which is headquartered in Melbourne, Australia, is a leading aftermarket distributor of automotive replacement parts and accessories in Australasia, with annual revenues of approximately $1,000,000,000 and a company-owned store footprint of approximately 500 locations across Australia and New Zealand. This acquisition provides an opportunity for the Company to participate in the ongoing and significant growth opportunities in the Australasian aftermarket.

The Company recognized certain one-time positive purchase accounting pre-tax adjustments of approximately $33,000,000, or $0.21 net of taxes on a per share diluted basis, as a result of the acquisition. The net one-time purchase accounting adjustments consisted of a gain of approximately $59,000,000 related to remeasuring the 30% investment in GPC Asia Pacific held before the business combination to fair value, the post-closing sale of acquired inventory written up to fair value of $21,000,000 as part of the purchase price allocation, and certain negative adjustments of approximately $5,000,000.

Prior to the 70% acquisition, the Company accounted for the 30% investment under the equity method of accounting. The acquisition-date fair value of the 30% investment was approximately $234,000,000 and is included in the measurement of the consideration transferred. The difference between the acquisition-date fair value and the carrying amount of the equity method investment resulted in the recognition of a gain of approximately $59,000,000 on the acquisition date. The acquisition-date fair value was determined using a market and income approach with the assistance of a third party valuation firm. Both approaches were given equal weight in the conclusion of fair value, which the Company believes is a reasonable approach. For the market approach, the Company utilized companies that are comparable in line of business, size, operating performance, and financial condition to GPC Asia Pacific to develop a market multiple. For the income approach, the Company utilized GPC Asia Pacific’s projected cash flows, an appropriate discount rate, and an expected long-term growth rate. For both approaches, the Company applied discounts for lack of control and lack of marketability.

As part of the allocation of purchase price described below, acquired inventory was written up to fair value, which was approximately $21,000,000 above the cost of the acquired inventory. Based on the inventory turn of the acquired inventories, the entire write-up was recognized in cost of goods sold during 2013.

The net $54,000,000 of one-time gain and other adjustments are included in the line item selling, administrative and other expenses and the acquired inventory adjustment of $21,000,000 is included in cost of goods sold in the consolidated statements of income and comprehensive income for the year ended December 31, 2013.

The acquisition date fair value of the consideration transferred totaled approximately $824,000,000, net of cash acquired of $70,000,000, which consisted of the following:


	April 1, 2013
	(In Thousands)
Cash	$	590,000
Fair value of 30% investment held prior to business combination		234,000

Total	$	824,000

The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date.


	April 1, 2013
	(In Thousands)
Trade accounts receivable	$	94,000
Merchandise inventory		306,000
Prepaid expenses and other current assets		31,000
Property and equipment		59,000
Intangible assets		347,000
Other assets		24,000

Total identifiable assets acquired		861,000
Current liabilities		(224,000	)
Long-term debt		(230,000	)
Deferred tax liabilities and other		(125,000	)

Total liabilities assumed		(579,000	)
Net identifiable assets acquired		282,000
Goodwill		542,000

Net assets acquired	$	824,000

The acquired intangible assets of approximately $347,000,000 were assigned to customer relationships of $202,000,000, trademarks of $141,000,000, and non-compete agreements of $4,000,000, with weighted average amortization lives of 16, 40, and 1 year, respectively, for a total weighted average amortization life of 26 years.

The goodwill recognized as part of the acquisition is not tax deductible and has been assigned to the automotive segment. The goodwill is attributable primarily to expected synergies and the assembled workforce of GPC Asia Pacific.

The amounts of net sales and earnings of GPC Asia Pacific included in the Company’s consolidated statements of income and comprehensive income from April 1, 2013 to December 31, 2013 were approximately $839,000,000 in net sales and net income of $0.43 on a per share diluted basis, respectively.

The unaudited pro forma consolidated statements of income and comprehensive income of the Company as if GPC Asia Pacific had been included in the consolidated results of the Company for the year ended December 31, 2013 would be estimated at $14,400,000,000 in net sales and net income of $4.42 on a per share diluted basis. The pro forma information is not necessarily indicative of the results of operations that we would have reported had the transaction actually occurred at the beginning of this period, nor is it necessarily indicative of future results.

The adjustments to the pro forma amounts include, but are not limited to, applying the Company’s accounting policies, amortization related to fair value adjustments to intangible assets, one-time purchase accounting adjustments, interest expense on acquisition related debt, and any associated tax effects.