Acquisition

On November 17, 2016, we acquired substantially all of the assets of Angelic Bakehouse, Inc. (“Angelic”). Angelic, a privately owned manufacturer and marketer of premium sprouted grain bakery products, is based near Milwaukee, Wisconsin. The initial purchase price of $35.0 million was funded by cash on hand and excludes contingent consideration relating to an additional earn-out payment which is tied to performance-based conditions. In general, the terms of the acquisition specify that the sellers will receive an earn-out based upon a pre-determined multiple of the defined adjusted EBITDA of Angelic in fiscal 2021. We are unable to provide a range for the amount of this earn-out because it is based on the future adjusted EBITDA of Angelic, and the earn-out does not contain a minimum or maximum value. See further discussion of the earn-out in Note 3.

Angelic is reported in our Specialty Foods segment, and its results of operations have been included in our condensed consolidated financial statements from the date of acquisition. Such results were not material.

The following table summarizes the consideration related to the acquisition and the preliminary purchase price allocation based on the fair value of the net assets acquired, as adjusted for the preliminary net working capital adjustment recorded as of March 31, 2017. The initial fair value of the contingent consideration is a noncash investing activity.



Consideration
Cash paid for acquisition	$	34,997
Contingent consideration - fair value of earn-out at date of closing	13,872
Working capital adjustment receivable	(63		)
Fair value of total consideration	$	48,806

Preliminary Purchase Price Allocation
Trade receivables	$	831
Other receivables	550
Inventories	430
Other current assets	19
Property, plant and equipment	5,083
Goodwill (tax deductible)	21,120
Other intangible assets	21,491
Current liabilities	(718		)
Net assets acquired	$	48,806

Further adjustments may occur to the allocation above as certain aspects of the transaction are finalized during the measurement period.

The goodwill recognized above arose because the purchase price for Angelic reflects a number of factors including the future earnings and cash flow potential of Angelic, as well as the impact of the inclusion of the initial fair value of the earn-out associated with the acquisition. Angelic is a fast growing, on-trend business with placement in the specialty deli/bakery section of the grocery store and provides innovation opportunities within and beyond our present product lines. Goodwill also resulted from the workforce acquired with Angelic.

We have determined preliminary values and lives of the other intangible assets listed in the allocation above as: $18.6 million for the tradename with a 20-year life; $0.3 million for the customer relationships with a 10-year life; $2.4 million for the technology / know-how with a 10-year life and $0.2 million for the non-compete agreements with a 5-year life.

Pro forma results of operations have not been presented herein as the acquisition was not material to our results of operations.