Acquisitions and Dispositions

3 Months Ended

Mar. 31, 2018

Business Combinations And Discontinued Operations and Disposal Groups [Abstract]

Acquisitions and Dispositions

Acquisitions and Dispositions

Acquisition of Ceilings Plus

On November 30, 2017, we completed our acquisition of Ceilings Plus for $50 million, net of a working capital adjustment received in the first quarter of 2018. The addition of Ceilings Plus to our U.S. Ceilings segment expands our operations in the specialty ceilings markets. The preliminary fair value of tangible assets acquired, less liabilities assumed, in connection with the Ceilings Plus acquisition was $18 million. The preliminary fair value of intangible assets acquired, which included customer relationships and trade names, totaled $20 million. The resulting preliminary goodwill recorded was $12 million and all is expected to be deductible for tax purposes. The goodwill resulting from this acquisition consists largely of the company’s expected future product sales and synergies with the existing U.S. Ceilings product offerings. The primary area of the preliminary purchase price allocation remaining to be valued is the fair value of acquired contracts. We will complete the fair value assessment within the one year measurement period.

Discontinued Operations

On October 31, 2016, we completed the sale of our L&W Supply, or L&W, distribution business to ABC Supply. Upon the close of the sale, we entered into a supply agreement with L&W, and for the three months ended March 31, 2018 and 2017, we recorded sales of $95 million and $131 million, respectively, and cash inflows related to payments on trade receivables during those same periods of $104 million and $109 million, respectively.