Acquisitions (Tables)

6 Months Ended

Nov. 30, 2017

Schedule of Assets Acquired and Liabilities Assumed

The total purchase price was $2,078.4 million, which was funded using a combination of new senior notes, a term loan, other borrowings under our existing credit facility and cash on hand. The net consideration transferred for G&K consisted of the following items:



(In thousands)

Cash consideration for common stock	$	1,901,845		⁽¹⁾
Cash consideration for share-based awards	62,257			⁽²⁾
Cash consideration for G&K revolving debt	124,180			⁽³⁾
Cash consideration for transaction expenses	24,529			⁽⁴⁾
Total consideration	2,112,811
Cash acquired	(34,393		)	⁽⁵⁾
Net consideration transferred	$	2,078,418

⁽¹⁾ The cash consideration for outstanding shares of G&K common stock is the product of the agreed-upon cash per share price of $97.50 and total G&K outstanding shares of approximately 19.5 million.

⁽²⁾ The cash consideration for share-based awards is the product of the agreed-upon cash per share price of $97.50 and the total number of restricted stock outstanding and the “in the money” stock options net of the weighted average exercise price.

⁽³⁾ The cash consideration for G&K revolving debt reflects the repayment of the outstanding obligation.

⁽⁴⁾ Represents G&K legal and professional fees that were incurred prior to acquisition and were due upon the closing of the transaction.

⁽⁵⁾ Represents the G&K cash balance acquired at acquisition.

The components of the preliminary purchase price allocation, at fair value, are as follows:



Assets
Accounts receivable	$	95,846
Inventories	30,254
Uniforms and other rental items in service	93,659
Income taxes, current	15,873
Prepaid expenses and other current assets	43,235
Property and equipment	254,035
Goodwill	1,520,295
Service contracts	519,000
Trade names	17,000
Other assets	15,585
Liabilities
Accounts payable	(53,220		)
Accrued compensation and related liabilities	(9,594		)
Accrued liabilities	(115,109		)
Long-term accrued liabilities	(28,380		)
G&K senior notes	(105,359		)
Deferred income taxes	(214,702		)
Total consideration	$	2,078,418

Schedule of Preliminary Valuation and Amortization Period of Identifiable Intangible Assets

The table below sets forth the preliminary valuation and amortization period of identifiable intangible assets:



Identifiable intangible assets	Preliminary Valuation		Amortization Period

Service contracts	$	519,000	15 years
Trade names	17,000		3 years
Total	$	536,000

Schedule of Pro Forma Financial Information

The pro forma financial information set forth below for the three and six months ended November 30, 2016 includes G&K's quarterly and year to date results, respectively, for the periods of October 2, 2016 through December 31, 2016 and July 2, 2016 through December 31, 2016, adjusted for number of working days in Cintas' first and second quarters of fiscal 2017.



	Three Months Ended		Six Months Ended
(In thousands except per share data)	November 30, 2016		November 30, 2016

Net sales	$	1,515,222	$	3,026,600
Net income from continuing operations	$	131,212	$	277,625

Earnings from continuing operations per common share - diluted	$	1.20	$	2.54