Acquisitions (Notes)

3 Months Ended

Apr. 30, 2020

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

NOTE 3 — ACQUISITIONS

DLT Acquisition

On November 25, 2019, the Company completed the acquisition of DLT Solutions ("DLT"), a premier software and cloud solutions aggregator focused on the U.S. public sector. The Company acquired all of the outstanding shares of DLT for a preliminary purchase price of approximately $210 million in cash, subject to certain working capital and other adjustments. The DLT acquisition enables Tech Data to proactively develop opportunities, accelerate growth and simplify complexity for its channel partners that are serving the U.S. public sector space.

The Company has accounted for the DLT acquisition as a business combination and allocated the preliminary estimated purchase price to the estimated fair values of assets acquired and liabilities assumed. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily related to the final assessment and valuation of certain other assets acquired and liabilities assumed, including accounts receivable, deferred taxes, accrued expenses and other liabilities. Therefore, the final fair values of the assets acquired and liabilities assumed may vary from the Company's preliminary estimates. During the three months ended April 30, 2020, the Company updated its estimated fair values of certain assets acquired and liabilities assumed, including an increase in goodwill of $15 million and a decrease in intangible assets of $15 million.

The preliminary allocation of the estimated purchase price to assets acquired and liabilities assumed is as follows:



(in thousands)
Cash	$	545
Accounts receivable	219,543
Prepaid expenses and other current assets	22,832
Property and equipment, net	4,207
Goodwill	97,481
Intangible assets	211,400
Other assets, net	52,539
Total assets	608,547

Accounts payable, accrued expenses and other current liabilities	297,833
Revolving credit loans and other long-term debt	91,026
Other long-term liabilities	9,220
Total liabilities	398,079

Estimated purchase price	$	210,468

The allocation of the value of identifiable intangible assets is comprised of approximately $193.0 million of customer and vendor relationships with an amortization period of 15 years and $18.4 million of trade names with an amortization period of 10 years. Goodwill is the excess of the consideration transferred over the net assets recognized and primarily represents the expected cost synergies of the combined company and assembled workforce and is expected to be deductible for tax purposes. Pro forma information has not been provided as the acquisition was not material to the Company's consolidated financial position or results of operations.