ACQUISITIONS

Griffon accounts for acquisitions under the acquisition method, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition using a method substantially similar to the good impairment test methodology (level 3 inputs). The operating results of the acquired companies are included in Griffon’s consolidated financial statements from the date of acquisition.

On April 16, 2015, AMES acquired the assets of an operational wood mill in Champion, PA from the Babcock Lumber Company for $2,225. The purchase price was preliminarily allocated to property, plant and equipment. The wood mill secures wood supplies, lowers overall production costs and mitigates risk associated with manufacturing handles for wheelbarrows and long-handled tools.

On May 21, 2014, AMES acquired the Australian Garden and Tools business of Illinois Tool Works, Inc. (“Cyclone”) for approximately $40,000. Cyclone, which was integrated with AMES, offers a full range of quality garden and hand tool products sold under various leading brand names including Cyclone®, Nylex® and Trojan®, designed to meet the requirements of both the Do-it-Yourself and professional trade segments. SG&A expenses included $2,363 of related acquisition costs in 2014.

On December 31, 2013, AMES acquired Northcote Pottery™ (“Northcote”), founded in 1897 and a leading brand in the Australian outdoor planter and decor market, for approximately $22,000. Northcote complements Southern Patio®, acquired in 2011, and adds to AMES’ existing lawn and garden operations in Australia. SG&A expenses included $798 of related acquisition costs in 2014.

The accounts of the acquired companies, after adjustment to reflect fair market values (level 3 inputs), have been included in the consolidated financial statements from the date of acquisition; in each instance, acquired inventory was not significant.



	Cyclone			Northcote			Total
Current Assets and Other, net of cash acquired	$	21,116		$	7,398		$	28,514
PP&E	488			1,385			1,873
Goodwill	13,587			11,254			24,841
Amortizable intangible assets	11,608			6,098			17,706
Indefinite life intangible assets	3,548			3,121			6,669
Total assets acquired	$	50,347		$	29,256		$	79,603
Total liabilities assumed	(10,822		)	(7,475		)	$	(18,297	)
Net assets acquired	$	39,525		$	21,781		$	61,306

The amounts assigned to major intangible asset classifications, none of which are tax deductible, are as follows:



	Cyclone		Northcote		Total		Amortization Period (Years)
Goodwill	$	13,587	$	11,254	$	24,841	N/A
Trade names	3,548		3,121		6,669		Indefinite
Customer relationships	11,608		6,098		17,706		25
	$	28,743	$	20,473	$	49,216