Business Combinations

12 Months Ended

Dec. 31, 2016

Business Combinations [Abstract]

Business Combinations

BUSINESS COMBINATIONS

In February 2015, we completed the acquisition of ARAS 360 Technologies Inc. (“ARAS”) for a purchase price, net of cash acquired, of $7.6 million, paid with cash on hand, subject to certain additional post-closing adjustments, and up to an additional $4.0 million in contingent consideration that may be earned over a two-year period, of which none has been earned as of December 31, 2016. ARAS, a privately-held business headquartered in Canada, produces a full suite of accident and crime reconstruction software tools that offer advanced graphics, analytical tools, and the ability to work with large point cloud data. The acquisition complements our portfolio within the Public Safety Forensics vertical.

In March 2015, we completed the acquisition of kubit GmbH for a purchase price, net of cash acquired, of $4.4 million, paid with cash on hand, subject to certain additional post-closing adjustments, and up to an additional $3.3 million in contingent consideration that may be earned over a three-year period, of which $0.4 million has been earned as of December 31, 2016. The acquisition also included substantially all of the assets of kubit GmbH’s U.S. distributor kubit USA, Inc. (collectively “kubit”). Kubit, a privately-held business with operating facilities in Germany and the United States, develops software for surveying and as-built documentation. The acquisition complements our portfolio of software products, specifically in the Construction BIM-CIM vertical.

In July 2016, we acquired BuildIT Software & Solutions Ltd. (“BuildIT”) for a purchase price, net of cash acquired, of $3.9 million, paid with cash on hand, subject to certain additional post-closing adjustments. BuildIT, a software solutions business located in Montreal, Canada, specializes in process-configurable 3D metrology software solutions with hardware agnostic interfaces. The addition of BuildIT enhances our metrology portfolio, providing customers greater software options to use in a variety of applications to reduce inspection and assembly times and increase productivity.

In August 2016, we acquired Laser Projection Technologies, Inc. (“LPT”) for a purchase price, net of cash acquired, of $17.2 million, paid with cash on hand, subject to certain additional post-closing adjustments. LPT, located in Londonderry, New Hampshire, specializes in laser projection and measurement systems used throughout manufacturing environments around the globe to maximize productivity and efficiency. The acquisition enhances our portfolio of 3D measurement solutions and supports our long-term strategy to expand our presence in key markets.

In December 2016, we acquired MWF-technology, GmbH (“MWF”) for a purchase price, net of cash acquired, of $6.6 million, paid with cash on hand, subject to certain post-closing adjustments. MWF, an innovator in mobile augmented reality solutions located near Frankfurt, Germany, provides technology that enables large, complex 3D CAD data to be transferred to a tablet device for use in mobile visualization and comparison to real world conditions. This enables real time, actionable manufacturing insight for in-process inspection, assembly, guidance and positioning.

The acquisitions of ARAS, Kubit, BuildIT, LPT and MWF constitute business combinations as defined by FASB ASC Topic 805, Business Combinations. Accordingly, the assets acquired and liabilities assumed were recorded at their fair values on the date of acquisition. The purchase price allocations marked as “Preliminary” below are based on the information that was available to make estimates of the fair value and may change as further information becomes available and additional analyses are completed. While we believe such information provided a reasonable basis for estimating the fair values, we may obtain more information and evidence during the measurement period that may result in changes to the estimated fair value amounts. The measurement period ends on the earlier of one year after the acquisition date or the date we received the information about the facts and circumstances that existed at the acquisition date. Subsequent adjustments, if necessary, will be recognized during the period in which the amounts are determined. These refinements include: (1) changes in the estimated fair value of certain intangible assets acquired; and (2) changes in deferred tax assets and liabilities related to the fair value estimates. The purchase price allocations marked as “Final” below represent our final determination of the fair value of the assets acquired and liabilities assumed for such acquisitions.

Following is a summary of our allocations of the purchase price to the fair values of the assets acquired and liabilities assumed as of the date of each acquisition:

	ARAS (Final)			kubit (Final)			BuildIT (Final)			LPT (Preliminary)			MWF (Preliminary)
Accounts receivable	$	294		$	136		$	237		$	54		$	150
Inventory	—			—			—			322			—
Other assets	—			246			36			160			666
Deferred income tax assets	—			—			—			1,112			—
Intangible assets	5,351			2,571			1,015			5,474			1,816
Goodwill (1)	4,964			3,805			3,393			11,872			5,364
Accounts payable and accrued liabilities	(27		)	(182		)	(95		)	(697		)	(700		)
Other liabilities	(219		)	(489		)	(471		)	(1,086		)	(345		)
Deferred income tax liabilities	(1,385		)	(674		)	(205		)	—			(364		)
Contingent consideration	(1,338		)	(987		)	—			—			—
Total purchase price, net of cash acquired	$	7,640		$	4,426		$	3,910		$	17,211		$	6,587

(1) The goodwill arising from the acquisitions consists largely of the expected synergies from combining operations as well as the value of the workforce. The goodwill value is not expected to be tax deductible.

Following are the details of the purchase price allocated to the intangible assets acquired for the acquisitions noted above:

	ARAS (Final)			kubit (Final)			BuildIT (Final)			LPT (Preliminary)			MWF (Preliminary)
	Amount		Weighted Average Life	Amount		Weighted Average Life	Amount		Weighted Average Life	Amount		Weighted Average Life	Amount		Weighted Average Life
Trade name	$	509	5	$	658	6	$	346	7	$	64	1	$	36	1
Non-competition agreement	540		4	272		3	31		5	—		0	3		2
Technology	2,052		5	945		5	361		7	4,260		7	951		5
Customer relationships	2,250		7	696		6	277		7	1,150		7	826		5
Fair value of intangible assets acquired	$	5,351	5	$	2,571	5	$	1,015	7	$	5,474	7	$	1,816	5

Acquisition and integration costs are not included as components of consideration transferred, but are recorded as expense in the period in which such costs are incurred. To date, we have incurred approximately $1.0 million in acquisition and integration costs for the ARAS, kubit, BuildIT, LPT and MWF acquisitions.

Pro forma results of operations for ARAS, kubit, BuildIT, LPT and MWF have not been presented because the effects of these acquisitions, individually and in aggregate, were not material to our consolidated results of operations.