Business Combinations

12 Months Ended

Aug. 31, 2014

Business Combinations [Abstract]

Business Combinations

Business Combinations

During fiscal 2014, the Company made the following acquisition:

• In November 2013, the Company acquired all of the equity interests of Pick A Part, Inc., a used auto parts business with one store in the Olympia metropolitan area in Washington, which expanded the Auto Parts Business’ presence in the Pacific Northwest and is near the Metals Recycling Business’ operations in Tacoma, Washington.

During fiscal 2013, the Company made the following acquisitions:

• In December 2012, the Company acquired substantially all of the assets of Ralph’s Auto Supply (B.C.) Ltd., a used auto parts business with four stores in Richmond and Surrey, British Columbia, which expanded APB’s presence in Western Canada and is near MRB’s operations in Surrey, British Columbia.

• In December 2012, the Company acquired substantially all of the assets of U-Pick-It, Inc., a used auto parts business with two stores in the Kansas City metropolitan area in Missouri and Kansas, which expanded APB’s presence in the Midwestern U.S.

• In December 2012, the Company acquired all of the equity interests of Freetown Self Serve Used Auto Parts, LLC, Freetown Transfer Facility, LLC, Millis Used Auto Parts, Inc. and Millis Industries, Inc., which together operated a used auto parts and scrap metal recycling business with two stores in Massachusetts. This acquisition established a new APB presence in the Northeastern U.S. and expanded the nearby MRB operations.

• In June 2013, the Company acquired substantially all of the assets of Bill’s Auto Parts, Inc. and Perkins Horseshoe Works, Inc., which operated a used auto parts business with one store in Rhode Island. This acquisition expanded APB’s presence in the Northeastern U.S. and is near MRB’s operations.

The aggregate consideration paid for the fiscal 2013 acquisitions was $26 million, which was allocated to tangible and identifiable intangible assets acquired and liabilities assumed based on their respective estimated fair values on the date of acquisition. The excess of the aggregate consideration paid over the fair value of the identifiable net assets acquired of $20 million was recorded as goodwill, of which $18 million is expected to be deductible for tax purposes. From the dates of acquisition through August 31, 2013, the acquired operations generated aggregate revenues from sales to third parties of $11 million and operating losses of $4 million, excluding the benefits realized from integrating the acquired businesses with existing operations located in geographic proximity.

During fiscal 2012, the Company made the following acquisition:

• In June 2012, the Company acquired substantially all of the assets of Rocky Mountain Salvage, Ltd., a metals recycler in Hinton, Alberta, which expanded MRB’s presence in Western Canada.

The acquisitions completed in fiscal 2014, 2013, and 2012, respectively, were not material to the Company’s financial position or results of operations. Pro forma operating results for the fiscal 2014, 2013, and 2012 acquisitions are not presented, since the aggregate results would not be significantly different than reported results.

The Company paid a premium (i.e., goodwill) over the fair value of the net tangible and identified intangible assets acquired in the transactions described above for a number of reasons, including but not limited to the following:

• The Company will benefit from the assets and capabilities of these acquisitions, including additional resources, skills and industry expertise;

• The acquired businesses increase the Company’s market presence in new and existing regions; and

• The Company anticipates cost savings, efficiencies and synergies.