Acquisitions

12 Months Ended

Dec. 31, 2011

Acquisitions [Abstract]

ACQUISITIONS

3. ACQUISITIONS

2011 Acquisitions

Hill Hire plc — On June 8, 2011, we acquired all of the common stock of Hill Hire plc (Hill Hire), a U.K. based full service leasing, rental and maintenance company for a purchase price of $251 million, net of cash acquired, all of which was paid in 2011. The acquisition included Hill Hire’s fleet of approximately 8,000 full service lease and 5,700 rental vehicles, and approximately 400 contractual customers. The fleet included 9,700 trailers. The combined network operates under the Ryder name, complementing our business segment market coverage in the U.K. Transaction costs related to the Hill Hire acquisition were $2 million during 2011 and were primarily reflected within ‘‘Selling, general and administrative expenses.”

The following table provides a rollforward of the preliminary estimated fair values of the assets acquired and the liabilities assumed at the date of the acquisition of Hill Hire to the amounts as of December 31, 2011:

	Preliminary Amount Disclosed			Purchase Accounting Adjustments			Purchase Price Allocation as  of December 31, 2011
	(In thousands)
Assets:
Revenue earning equipment	$	201,429			(467	)		200,962
Operating property and equipment		18,780			—			18,780
Customer relationships and other intangibles		5,567			4,566			10,133
Other assets, primarily accounts receivable		60,988			(809	)		60,179
		286,764			3,290			290,054
Liabilities, primarily accrued liabilities		(35,269	)		(3,290	)		(38,559	)
Net assets acquired	$	251,495			—			251,495

Other Acquisitions—During 2011, we completed three other acquisitions of full service leasing and fleet service companies, one of which included the assets of the seller’s DCC business. The combined networks operate under the Ryder name, complementing our FMS and DCC business segment market coverage throughout the United States. The purchase price of these acquisitions totaled $114 million, of which $106.8 million was paid during 2011. Goodwill and customer relationship intangibles related to these acquisitions totaled $28 million and $12 million, respectively. The following table provides further information regarding each of these acquisitions:

Company Acquired	Date Acquired	Segment	Purchase Price	Vehicles	Contractual Customers
Carmenita Leasing, Inc.	January 10, 2011	FMS	$9 million	190	60
The Scully Companies	January 28, 2011	FMS/DCC	$91 million	2,100	200
B.I.T Leasing	April 1, 2011	FMS	$14 million	490	130

During 2011, all acquisitions had combined revenue and net earnings of $473 million and $42 million, respectively.

2010 Acquisitions

Total Logistic Control – On December 31, 2010, we acquired all of the common stock of Total Logistic Control (TLC), a leading provider of comprehensive supply chain solutions to food, beverage, and consumer packaged goods manufacturers in the U.S. TLC provides customers a broad suite of end-to-end services, including distribution management, contract packaging services and solutions engineering. This acquisition enhances our SCS capabilities and growth prospects in the areas of packaging and warehousing, including temperature-controlled facilities. The purchase price was $207 million, of which $2.6 million was paid in 2011. No further payments are due related to this acquisition. During 2011, the purchase price was reduced by $1 million due to contractual adjustments in acquired deferred taxes and working capital.

The following table provides a rollforward of the preliminary estimated fair values of the assets acquired and the liabilities assumed at the date of the TLC acquisition to the final allocated amounts:

	Preliminary Amount Disclosed in 2010 Annual Report			Purchase Accounting Adjustments			Final Allocation
	(In thousands)
Assets:
Current Assets	$	24,249			339			24,588
Operating property and equipment		75,471			(2,336	)		73,135
Goodwill		138,321			(6,410	)		131,911
Customer relationships and other intangibles		35,380			(400	)		34,980
Other assets		632			184			816
		274,053			(8,623	)		265,430
Liabilities:
Current liabilities		(26,575	)		(300	)		(26,875	)
Deferred income taxes and other liabilities		(38,883	)		7,451			(31,432	)
		(65,458	)		7,151			(58,307	)
Net assets acquired	$	208,595			(1,472	)		207,123

The purchase price adjustments related primarily to adjustments in acquired deferred taxes and evaluations of the physical and market conditions of operating property and equipment.

2009 Acquisition

Edart Leasing LLC — On February 2, 2009, we acquired the assets of Edart Leasing LLC (Edart), which included Edart’s fleet of approximately 1,600 vehicles and more than 340 contractual customers from Edart’s five locations in Connecticut for a purchase price of $85 million of which $1 million, $2 million and $81 million, respectively, was paid in 2011, 2010 and 2009. The purchase price consisted mainly of revenue earning equipment and operating property. The combined network operates under the Ryder name, complementing our FMS business segment market coverage in the Northeast. We also acquired approximately 525 vehicles for remarketing.

Pro Forma Information – The operating results of each acquisition has been included in the consolidated financial statements from the dates of acquisition. The following table provides the unaudited pro forma revenues, net earnings and earnings per common share as if the results of the Hill Hire acquisition had been included in operations commencing January 1, 2010 and the TLC acquisition had been included in operations commencing January 1, 2009. This pro forma information is not necessarily indicative either of the combined results of operations that actually would have been realized had the acquisition been consummated during the periods for which the pro forma information is presented, or of future results. Pro forma information for the other acquisitions in 2011 and 2009 is not disclosed because the effect of these acquisitions is not significant.

	Years ended December 31,
	2011		2010		2009
	(In thousands, except per share amounts)
Revenue — As reported	$	6,050,534		5,136,435		4,887,254
Revenue — Pro forma	$	6,118,104		5,538,824		5,145,959
Net earnings — As reported	$	169,777		118,170		61,945
Net earnings — Pro forma	$	183,642		149,501		60,516
Net earnings per common share:
Basic — As reported	$	3.31		2.25		1.11
Basic — Pro forma	$	3.58		2.85		1.09
Diluted — As reported	$	3.28		2.25		1.11
Diluted — Pro forma	$	3.55		2.84		1.09

During 2010 and 2009, we paid $5 million and $8 million, respectively, related to other acquisitions completed in prior years.

All of the acquisitions were accounted for as an acquisition of a business. Goodwill on these acquisitions represents the excess of the purchase price over the fair value of the underlying acquired net tangible and intangible assets. Factors that contributed to the recognition of goodwill in our acquisitions included (i) expected growth rates and profitability of the acquired companies, (ii) securing buyer-specific synergies that increase revenue and profits and are not otherwise available to market participants, (iii) significant cost savings opportunities, (iv) the experienced workforce and (v) our strategies for growth in sales, income and cash flows.