Acquisitions

2014 Acquisitions

Allfast Fastening Systems

On October 17, 2014, the Company acquired 100% of the equity interest in Allfast Fastening Systems, Inc. ("Allfast") for the purchase price of approximately $351.2 million, net of cash acquired, with an additional $15.7 million of deferred purchase price related to certain tax related and other reimbursements in accordance with the purchase agreement. Allfast is a global manufacturer of solid and blind rivets, blind bolts, temporary fasteners and installation tools for the aerospace industry. The acquisition strengthens the Company's specialty product offering and is strategically aligned with its growing aerospace businesses. Allfast is included in the Company's Aerospace segment.

The following table summarizes the fair value of consideration paid for Allfast, and the assets acquired and liabilities assumed:



	October 17, 2014
	(dollars in thousands)
Consideration
Cash paid, net of cash acquired	$	351,220
Deferred purchase price^(a)	15,730
Total consideration	$	366,950
Recognized amounts of identifiable assets acquired and liabilities assumed
Receivables	$	8,950
Inventories	19,850
Intangible assets other than goodwill^(b)	165,000
Prepaid expenses and other assets	340
Property and equipment, net	26,490
Accounts payable and accrued liabilities	(2,620		)
Total identifiable net assets	218,010
Goodwill^(c)	148,940
	$	366,950

___________________________

^(a)Of the deferred purchase price, approximately $8.7 million, represents the Company's best estimate of the underlying obligations for certain tax amounts the Company has agreed to reimburse the previous owner in order to acquire additional tax attributes. In addition, it includes approximately $7.0 million of other liabilities which the Company has agreed to pay on behalf of the previous owner, of which approximately $4.1 million was paid during 2014.

^(b) Consists of approximately $83.0 million of customer relationships with an estimated useful life of 18 years, $33.0 million of technology and other intangible assets with an estimated useful life of 15 years and $49.0 million of trademark/tradename with an indefinite useful life.

^(c)All of the goodwill was assigned to the Company's Aerospace reportable segment and is expected to be deductible for tax purposes.

The results of operations of Allfast are included in the Company's results beginning October 17, 2014. The actual amounts of net sales and operating profit of Allfast included in the accompanying consolidated statement of income for the year ended December 31, 2014 are $9.1 million and $1.3 million, respectively.

The following table summarizes the supplemental pro forma results of the combined entity as if the acquisition had occurred on January 1, 2013. The supplemental pro forma information presented below is for informational purposes and is not necessarily indicative of either future results of operations or results that might have been achieved had the acquisition been consummated on January 1, 2013:



	Pro forma Combined ^(a)
	Year ended December 31,
	2014		2013
	(dollars in thousands)
Net sales	$	1,548,220	$	1,442,490
Net income attributable to TriMas Corporation	$	69,430	$	76,260

___________________________

^(a)The supplemental pro forma results reflect certain material adjustments, as follows:


1.	Pre-tax pro forma adjustments for amortization expense of $6.0 million and $6.8 million for the years ended December 31, 2014 and December 31, 2013 on the intangible assets associated with the acquisition.


2.	Pre-tax pro forma adjustments of $4.9 million and $7.1 million for the years ended December 31, 2014 and December 31, 2013, respectively, to reflect interest expense incurred on the incremental term loan A and revolver borrowings incurred in order to fund the acquisition.

Total acquisition costs incurred by the Company in connection with its purchase of Allfast, primarily related to third party legal, accounting and tax diligence fees, were approximately $2.2 million, all of which were incurred during 2014. These costs are recorded in selling, general and administrative expenses in the accompanying consolidated statement of income.

Other Acquisitions

In July 2014, the Company completed the acquisition of Lion Holdings PVT. Ltd. ("Lion Holdings") within the Company's Packaging reportable segment for the amount of approximately $27.5 million, net of cash acquired. Located in both India and Vietnam, Lion Holdings specializes in the manufacture of highly engineered dispensing solutions and generated approximately $10 million in revenue for the twelve months ended June 30, 2014.

The Company has recorded preliminary purchase accounting adjustments for its 2014 acquisitions, but may refine such amounts as it finalizes these estimates during the requisite one-year measurement periods.

2013 Acquisitions

During 2013, the Company completed various 100%-owned acquisitions for an aggregate amount of approximately $105.8 million, net of cash acquired, with an additional $12.4 million of deferred purchase price and contingent consideration, based primarily on a fixed date and payment schedule over the next five years. Of these acquisitions, the most significant, in chronological order of acquisition date, are as follows:

•

Martinic Engineering, Inc. ("Martinic"), acquired in January, located in the United States and included in the Company's Aerospace reportable segment, is a manufacturer of highly-engineered, precision machined, complex parts for commercial and military aerospace applications, including auxiliary power units, as well as electrical, hydraulic and pneumatic systems and generated approximately $13 million in revenue for the 12 months ended December 31, 2012.

•

Wulfrun Specialised Fasteners Limited ("Wulfrun"), acquired in March, located in the United Kingdom and included in the Company's Energy reportable segment, is a manufacturer and distributor of specialty bolting and CNC machined components for use in critical oil and gas, pipeline and power generation applications, and generated approximately $10 million in revenue for the 12 months ended December 31, 2012.


•	C.P. Witter Limited ("Witter"), acquired in April, located in the United Kingdom and included in the Company's Cequent APEA reportable segment, is a manufacturer of highly-engineered towbars and accessories which are distributed through a wide network of commercial dealers, and generated approximately $20 million in revenue for the 12 months ended March 31, 2013.

•

Towing technology and business assets of AL-KO GmbH ("AL-KO"), acquired in July, located in Germany and Finland and is included in the Company's Cequent APEA reportable segment. The acquired assets generated approximately $16 million of revenue for the 12 months ended June 30, 2013. The fair value of the AL-KO net assets acquired exceeded the purchase price, resulting in a bargain purchase gain of approximately $2.9 million, which is included in other (expense), net in the accompanying consolidated statement of income.

•

Mac Fasteners, Inc. ("Mac Fasteners"), acquired in October, located in the United States and included in the Company's Aerospace reportable segment, is in the business of manufacturing and distribution of stainless steel aerospace fasteners, globally utilized by OEMs, aftermarket repair companies, and commercial and military aircraft producers, and generated approximately $17 million in revenue for the 12 months ended September 30, 2013.


•	DHF Soluções Automotivas Ltda ("DHF"), acquired in November, located in Brazil within the Company's Cequent Americas reportable segment, is a manufacturer and distributor of aftermarket automotive hitching and accessory products, and generated approximately $12 million of revenue for the 12 months ended September 30, 2013.

While the individual and aggregate historical and current year revenue and earnings associated with the Company's 2013 acquisitions is not significant compared to the Company's total results of operations, the following information has been provided to summarize the aggregate fair value of consideration paid for the acquisitions, the assets acquired and liabilities assumed.



	Year ended December 31, 2013
	(dollars in thousands)
Consideration
Initial cash paid net of cash acquired	$	105,790
Deferred/contingent consideration^(a)	12,370
Total consideration	$	118,160
Recognized amounts of identifiable assets acquired and liabilities assumed
Receivables	$	12,420
Inventories	27,350
Intangible assets other than goodwill^(b)	41,140
Prepaid expenses and other assets	17,480
Property and equipment, net	20,930
Accounts payable and accrued liabilities	(12,510		)
Deferred income taxes	(8,900		)
Other long-term liabilities	(18,580		)
Total identifiable net assets	79,330
Goodwill^(c)	38,830
	$	118,160

__________________________

^(a)Deferred/contingent consideration includes approximately $9.8 million of both short-term and long-term deferred purchase price, based on set amounts and fixed payment schedules per the purchase agreement, and an additional $2.6 million of contingent consideration to be paid based on a multiple of future earnings, as defined.

^(b) Consists of approximately $27.6 million of customer relationships with an estimated weighted average useful life of 10 years, $1.5 million of technology and other intangible assets with an estimated weighted average useful life of four years and $12.1 million of trademark/trade names with an indefinite useful life.

^(c)Goodwill includes approximately $2.9 million of bargain purchase gain resulting from the acquisition of the towing technology and business assets of AL-KO, which is included in other expense, net in the accompanying consolidated statement of income for the year ended December 31, 2013.

2012 Acquisitions

Arminak & Associates

On February 24, 2012, the Company acquired 70% of the membership interests of Arminak & Associates, LLC ("Arminak") for the purchase price of approximately $67.7 million. Arminak is in the business of designing, manufacturing and supplying foamers, lotion pumps, fine mist sprayers and other packaging solutions for the cosmetic, personal care and household product markets. The acquisition of Arminak enhances the Company's highly-engineered product offering and provides access to large global customers in the cosmetic and personal care markets. Arminak is included in the Company's Packaging reportable segment.

The purchase agreement provides the Company an option to purchase, and Arminak's previous owners ("Sellers") an option to sell, the remaining 30% noncontrolling interest at specified dates in the future based on a multiple of earnings, as defined. The call and put options become exercisable during the first quarters of 2014, 2015 and 2016. During the first exercise period, in 2014, TriMas and the Sellers had the opportunity to call or put a 10% interest in Arminak. During the second exercise period, in 2015, TriMas and the Sellers have the opportunity to call or put an additional 10%, or up to all remaining interests held by Sellers per joint agreement, as defined in the purchase agreement. Finally, during the third exercise period, in 2016, a call or put may be exercised for all or any portions of the remaining interests held by the Sellers. The original combination of a noncontrolling interest and a redemption feature resulted in a redeemable noncontrolling interest, which was classified outside of permanent equity on the accompanying consolidated balance sheet. In order to estimate the fair value of the redeemable noncontrolling interest in Arminak upon acquisition, the Company utilized the Monte Carlo valuation method, using variations of estimated future discounted cash flows given certain significant assumptions including expected revenue growth, minimum and maximum estimated levels of gross profit margin, future expected cash flows, amounts transferred during each call and put exercise period and appropriate discount rates. As these assumptions are not observable in the market, the calculation represents a Level 3 fair value measurement. The Company recorded the redeemable noncontrolling interest at fair value at the date of acquisition.

On March 11, 2014, in lieu of the put call option in the original purchase agreement, the Company entered into a new agreement to purchase the entire 30% noncontrolling interest in Arminak for a cash purchase price of $51.0 million. The purchase agreement also includes additional contingent consideration of up to $7.0 million, with the amount to be earned based on the achievement of certain levels of 2015 financial performance. In order to estimate the fair value of the contingent consideration, the Company utilized the Monte Carlo valuation method, using variations of expected future payouts given certain significant assumptions including expected revenue and earnings growth, volatility and risk. As these assumptions are not observable in the market, the calculation represents a Level 3 fair value measurement. As of December 31, 2014, the estimated liability for the payout of the contingent consideration is $1.1 million. The final contingent consideration is expected to be paid, if earned, in the second quarter of 2016.

As part of purchasing the remaining membership interest, the Company finalized the calculation of the redeemable noncontrolling interest as of March 11, 2014. Changes in the carrying amount of redeemable noncontrolling interest are summarized as follows:



	Redeemable Noncontrolling interest
	(dollars in thousands)
Beginning balance, February 24, 2012	$	25,630
Distributions to noncontrolling interests	(1,260		)
Net income attributable to noncontrolling interests	2,410
Ending balance, December 31, 2012	$	26,780
Distributions to noncontrolling interests	(2,710		)
Net income attributable to noncontrolling interests	4,520
Redemption value adjustments for noncontrolling interests	890
Ending balance, December 31, 2013	$	29,480
Distributions to noncontrolling interests	(580		)
Net income attributable to noncontrolling interests	810
Ending balance, March 11, 2014	$	29,710

The difference between the cash purchase price and final redeemable noncontrolling interest as of March 11, 2014 was recorded as a reduction in paid in capital, net of tax, as included in the accompanying consolidated statement of shareholders' equity.

The following table summarizes the fair value of consideration paid for Arminak, and the assets acquired and liabilities assumed, as well as the fair value of the noncontrolling interest in Arminak at the acquisition date.



	February 24, 2012
	(dollars in thousands)
Consideration
Initial cash paid net of working capital adjustment	$	59,200
Contingent consideration ^(a)	8,490
Total consideration	$	67,690
Recognized amounts of identifiable assets acquired and liabilities assumed
Receivables	$	8,760
Inventories	4,200
Intangible assets other than goodwill ^(b)	48,400
Other assets	2,450
Accounts payable and accrued liabilities	(4,270		)
Long-term liabilities	(1,610		)
Total identifiable net assets	57,930
Redeemable noncontrolling interest	(25,630		)
Goodwill ^(c)	35,390
	$	67,690

__________________________

^(a)The contingent consideration represented the Company's best estimate, based on its review, at the time of purchase, of the underlying potential obligations estimated at a range of $8 million to $9 million, of certain Seller tax-related liabilities for which the Company indemnified the Sellers as part of the purchase agreement. During 2012, the Company paid $4.9 million of additional purchase price related to the contingent consideration. No additional amounts were paid during 2013 or 2014. The remaining liability range of $3.1 million to $4.1 million continues to represent the Company's best estimate of the remaining potential obligation at December 31, 2014.

^(b)Consists of $33.0 million of customer relationships with an estimated 10 year useful life, $7.9 million of trademarks/trade names with an indefinite useful life and $7.5 million of technology and other intangible assets with an estimated eight year useful life.

^(c)All of the goodwill was assigned to the Company's Packaging reportable segment and is expected to be deductible for tax purposes.

The results of operations of Arminak are included in the Company's results beginning February 24, 2012. The actual amounts of net sales and operating profit of Arminak included in the accompanying consolidated statement of income for the year ended December 31, 2012 are $65.9 million and $8.0 million, respectively.

The following table summarizes the supplemental pro forma results of the combined entity as if the acquisition had occurred on January 1, 2011. The supplemental pro forma information presented below is for informational purposes and is not necessarily indicative of either future results of operations or results that might have been achieved had the acquisition been consummated on January 1, 2011:



	Pro forma Combined ^(a)
	Year ended December 31,
	2012		2011
	(dollars in thousands)
Net sales	$	1,280,940	$	1,144,020
Net income attributable to TriMas Corporation	$	35,850	$	54,540

___________________________

^(a)The supplemental pro forma results reflect certain adjustments, such as adjustments for acquisition costs incurred and purchase accounting adjustments related to step-up in value and subsequent amortization of inventory and intangible assets.

Total acquisition costs incurred by the Company in connection with its purchase of Arminak, primarily related to third party legal, accounting and tax diligence fees, were approximately $1.3 million, of which approximately $1.0 million were incurred during the first quarter of 2012. These costs are recorded in selling, general and administrative expenses in the accompanying consolidated statement of income.

Other acquisitions

Also during 2012, the Company completed other acquisitions for approximately $26.8 million in cash, in aggregate, with an additional estimated $14.4 million of deferred purchase price and contingent consideration, based primarily on post-acquisition operating results, payable over the next five years. Of these acquisitions, the most significant, in chronological order of acquisition date, are as follows:


•	CIFAL Industrial e Comercial Ltda ("CIFAL"), within the Energy reportable segment, is a Brazilian manufacturer and supplier of specialty fasteners and stud bolts, primarily to the oil and gas industry and generated approximately $9 million in revenue for the twelve months ended June 30, 2012.


•	Engetran Engenharia, Indústria, e Comércio de Peças e Acessórios Veiculares Ltda ("Engetran"), within the Company's Cequent Americas reportable segment, is a Brazilian manufacturer of trailering and towing products including trailer hitches, skid plates and related accessories and generated approximately $6 million in revenue for the twelve months ended June 30, 2012.


•	Trail Com Limited ("Trail Com"), with locations in New Zealand and Australia, and included in the Company's Cequent APEA reportable segment, is a distributor of towing accessories and trailer components and generated approximately $12 million in revenue for the twelve months ended June 30, 2012.