ACQUISITIONS

12 Months Ended

Dec. 31, 2023

Business Combination and Asset Acquisition [Abstract]

ACQUISITIONS

ACQUISITIONS

The following table provides the preliminary and final purchase price allocations for IFS and Whiplash, respectively, of the fair value of the assets and liabilities as of the acquisition date. The excess of the purchase consideration over the aggregate estimated fair values of identifiable assets acquired and liabilities assumed was recorded as goodwill:

	November 1, 2023		January 1, 2022
(In millions)	IFS		Whiplash
Assets:
Total current assets	$	39	$	92
Operating property and equipment, net	20		40
Goodwill	79		280
Intangible assets, net	131		150
Sales-type leases and other assets	59		196
Total assets	328		758
Liabilities:
Total current liabilities	40		106
Other non-current liabilities	33		169
Total liabilities	73		275
Net assets acquired	$	255	$	483

On November 1, 2023, we acquired all the outstanding equity of IFS, which specializes in contract packaging, contract manufacturing and warehousing, primarily in the consumer packaged goods, retail, and healthcare industries, for an approximate purchase price of $255 million. The acquisition is included within the consumer packaged goods industry vertical in our SCS business segment and expands the product offerings that we can offer to our customers.

We believe that we have sufficient information to provide a reasonable basis for estimating the fair values of assets acquired and liabilities assumed. The purchase price excludes certain items to be resolved post-closing with the seller, which may result in additional adjustments to the final purchase price. Therefore, the provisional measurements of estimated fair values reflected are subject to change. We expect to finalize the valuation and complete the purchase consideration allocation no later than one year from the acquisition date. The goodwill recognized reflects anticipated supply chain services growth opportunities and expected synergies of combining IFS with our business. All of the goodwill is expected to be deductible for income tax purposes. All of the intangible assets acquired relates to customer relationship and is expected to be amortized over 11 to 14 years.

On January 1, 2022, we acquired all the outstanding equity of Whiplash, a leading national provider of omnichannel fulfillment and logistics services for a purchase price of $483 million. The acquisition is included in our SCS business segment, and will expand our e-commerce and omnichannel fulfillment network. The purchase price allocation of estimated fair values reflected were finalized during the fourth quarter of 2022. The goodwill recognized reflects anticipated supply chain services growth opportunities and expected synergies of combining Whiplash with our business. None of the goodwill is deductible for income tax purposes. Customer relationship intangible assets are expected to be amortized over 13 years. The cash paid from escrow during 2022 is reflected in "Acquisitions, net of cash acquired" in the Consolidated Statement of Cash Flows for the year ended December 31, 2022.

For the year ended December 31, 2022, we paid $32 million, net of cash acquired, related to other business combinations, primarily within the SCS segment, which resulted in additions to goodwill and intangible assets of $11 million and $6 million, respectively. On November 1, 2021, we acquired all the outstanding equity of Midwest, a warehousing, distribution, and transportation company based in Woodbridge, IL for a purchase price of $284 million. The acquisition is included in our SCS business segment.

Subsequent Event

On February 1, 2024, we acquired all the outstanding equity of CLH Parent Corporation (Cardinal Logistics) for a purchase price of $290 million. Cardinal Logistics is a leading customized dedicated contract carrier in North America, providing dedicated fleets and professional drivers, as well as complementary freight brokerage services, last-mile delivery and contract logistics services. Cardinal Logistics primarily serves the consumer packaged goods, omnichannel retail, automotive, and industrial verticals. This acquisition increases our scale and network density and further advances our strategy to accelerate growth in dedicated.