Business Combinations

12 Months Ended

Mar. 31, 2020

Business Combinations

Business Combinations

(4) Business Combinations

Fiscal 2020

During the fiscal year ended March 31, 2020, the Company acquired three individually immaterial businesses with an aggregate purchase price of $29,624 being paid at closing and a deferred consideration of $10,343 payable within a one-year period.  The purchase price is also subject to adjustment after the closing of up to an additional $28,853 in contingent consideration, in the aggregate, upon the achievement of certain revenue and operating margin targets. The performance period for these targets are ranging from 12 months to 24 months from the respective acquisition date. As of March 31, 2020, the fair value of contingent consideration for these acquisitions is $25,012. These acquisitions enhanced the breadth and depth of digital offerings and expanded the Company’s relationship with certain existing customers.

Under the purchase method of accounting, assets acquired are recorded at their estimated fair values. The Company is in the process of obtaining additional information primarily regarding valuation assumptions, including contingent consideration and may continue to adjust the preliminary estimated fair values after obtaining more information regarding asset valuations and revision of preliminary estimates.

The following table shows the aggregate preliminary purchase price allocation for these acquisitions:

	Amount		Useful Life
Consideration Transferred:
Cash paid at closing	$	29,624
Deferred consideration payable		10,343
Fair value of contingent consideration		24,964
Fair value of consideration		64,931
Less: Cash acquired		(462)
Total purchase price, net of cash acquired	$	64,469
Assets and Liabilities:
Cash and cash equivalents		462
Goodwill		27,316
Customer relationships		37,806	5 -7 years
Other net		(653)
Total purchase price	$	64,931

The primary items that generated goodwill for these acquisitions are the value of the acquired assembled workforce and other benefits expected to result from combining the acquired operations with those of the Company, neither of which qualify as a separate intangible asset.

The acquisitions completed during the fiscal year ended March 31, 2020 were not individually or in the aggregate material to our operations. Accordingly, pro forma results have not been presented.

Fiscal 2019

None.

Fiscal 2018

To strengthen our digital engineering capabilities and establish a solid base in Silicon Valley, on March 12, 2018, the Company acquired all of the outstanding shares of eTouch Systems Corp (“eTouch US”), and its Indian subsidiary, eTouch Systems (India) Pvt. Ltd (“eTouch India,” together with eTouch US, “eTouch”) for approximately $140,000 in cash, subject to certain adjustments. As part of the acquisition, the Company set aside up to an additional $15,000 for retention bonuses to be paid to eTouch management and key employees, in equal installments on the first and second anniversary of the transaction. The Company agreed to pay the purchase price in three tranches, with $80,000 million paid at closing, $42,500 on the 12-month anniversary of the close of the transaction, and $17,500 on the 18-month anniversary of the close of the transaction, subject in each case to certain adjustments. During the fiscal year ended March 31, 2019, the Company paid the 12-month anniversary purchase price payment of $42,500 and the retention bonus amount of $7,000 to the eTouch management and key employees. During the fiscal year ended March 31, 2020, we paid the 18-month anniversary purchase price payment of $17,500 and the remaining retention bonus related to the employees.