ACQUISITION

9 Months Ended

Jun. 30, 2011

Schedule of Business Acquisitions, by Acquisition [Text Block]

NOTE 3 — ACQUISITION

On September 30, 2010, Griffon purchased all of the outstanding stock of CHATT Holdings, Inc. (“ATT Holdings”), the parent of ATT, on a cash and debt-free basis, for $542,000 in cash, subject to certain adjustments (the “Purchase Price”). ATT is a global provider of non-powered lawn and garden tools, wheelbarrows, and other outdoor work products to the retail and professional markets. ATT’s brands include Ames®, True Temper®, Ames True Temper®, Garant®, Union Tools®, Razor-back®, Jackson®, Hound Dog® and Dynamic Design^TM. ATT’s brands hold the number one or number two market position in their respective major product categories. The acquisition of ATT expanded Griffon’s position in the home and building products market and provides Griffon the opportunity to recognize synergies with its other businesses.

ATT’s results of operations are not included in Griffon’s consolidated statements of operations or cash flows, or related footnotes for any period presented prior to September 30, 2010, except where explicitly stated as pro forma results. Griffon’s consolidated balance sheet at September 30, 2010 and related footnotes include ATT’s balances at that date. The accounts of the acquired company, after adjustments to reflect fair market values assigned to assets and liabilities, have been included in Griffon’s consolidated financial statements from the date of acquisition.

The following table summarizes estimated fair values of assets acquired and liabilities assumed as of the date of acquisition, and the amounts assigned to goodwill and intangible assets:

	2010
Current assets, net of cash acquired	$	195,214
PP&E		72,918
Goodwill *		259,930
Intangibles		203,290
Other assets		1,124
Total assets acquired		732,476
Total liabilities assumed		(190,476	)
Net assets acquired	$	542,000

Amounts assigned to goodwill and major intangible asset classifications are as follows:

	2010		Amortization Period (Years)
Goodwill (non-deductible) *	$	259,930		N/A
Tradenames (non-deductible)		76,090		Indefinite
Customer relationships (non-deductible)		127,200		25
	$	463,220

* During the current quarter, Goodwill was reduced, retrospectively, by $1,134, due to the prospective federal consolidated tax reporting of ATT and GFF, and accounting for the completion of ATT’s 2010 federal tax return.

Pro Forma Information

The following unaudited pro forma information illustrates the effect on Griffon’s revenue and net earnings for the three and nine months ended June 30, 2010, assuming the acquisition of ATT took place on October 1, 2009.

	Three Months Ended June 30, 2010		Nine Months Ended June 30, 2010
Revenue from continuing operations:
As reported	$	327,026	$	946,160
Pro forma		454,498		1,308,164
Net earnings from continuing operations:
As reported	$	4,989	$	11,203
Pro forma		10,783		24,520
Diluted earnings per share from continuing operations:
As reported	$	0.08	$	0.19
Pro forma		0.18		0.41
Average shares - Diluted (in thousands)		60,154		59,897

The pro forma results of operations have been prepared for comparative purposes only and include certain adjustments to actual financial results, such as imputed financing costs, and estimated amortization and depreciation expense as a result of intangibles and fixed assets acquired being measured at fair value. Such pro forma results do not purport to be indicative of the results of operations that would have actually resulted had the acquisition occurred on the date indicated, or that may result in the future.

During the 2011 first quarter, Plastics purchased a manufacturing business in Shanghai, China for $855. The purchase price was primarily allocated to fixed assets.