Acquisitions

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Acquisitions

Acquisitions

We account for acquisition transactions in accordance with ASC 805, Business Combinations. Accordingly, the results of operations of the acquiree are included in our consolidated financial statements from the acquisition date. The consideration transferred is allocated to the identifiable assets acquired and liabilities assumed based on estimated fair values at the acquisition date, with any excess recorded as goodwill. Transaction-related costs are expensed in the period the costs are incurred. During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill.

On August 5, 2024, our wholly-owned subsidiary, Boise Cascade Building Materials Distribution L.L.C. (BMD), acquired assets of a door and millwork operation in Boise, Idaho. The purchase price of the acquisition was $3.5 million, inclusive of a $1.3 million contingent liability reflecting the acquisition date fair value of earn-out payments. We paid $2.2 million at the acquisition date and funded the acquisition and related costs with cash on hand.

Brockway-Smith Company (BROSCO) Acquisition

On October 2, 2023, our wholly-owned subsidiary, BMD, completed the acquisition of BROSCO, a wholesale distributor specializing in doors and millwork, pursuant to the Agreement and Plan of Merger, dated August 22, 2023 (Merger Agreement), by and among BMD, Firepit Merger Sub, Inc., a wholly-owned subsidiary of BMD (the Merger Sub), BROSCO and the representative of the BROSCO stockholders. On the terms and subject to the conditions set forth in the Merger Agreement, on October 2, 2023, Merger Sub merged with and into BROSCO, with BROSCO surviving the merger as a wholly-owned subsidiary of BMD (the BROSCO Acquisition). The purchase price of the BROSCO Acquisition was $166.2 million, net of cash acquired, and inclusive of a post-transaction closing adjustment of $3.4 million based upon working capital and indebtedness as defined in the Merger Agreement. We funded the BROSCO Acquisition and related costs with cash on hand.

The following table summarizes the final allocations of the BROSCO Acquisition purchase price consideration to the assets acquired and liabilities assumed based upon their respective estimated fair values at the date of acquisition:

	Acquisition Date Fair Value
	(thousands)
Cash and cash equivalents	$	4,009
Accounts receivable	19,688
Inventories	36,000
Other current assets	159
Property and equipment	57,331
Other assets	508
Intangible assets:
Trade name	18,000
Customer relationships	29,000
Goodwill	32,296
Assets acquired	196,991
Accounts payable	2,144
Accrued liabilities	4,078
Deferred tax liabilities	20,121
Other long-term liabilities	478
Liabilities assumed	26,821
Net assets acquired	$	170,170
Consideration paid, net of cash acquired	$	166,161

Pro Forma Financial Information

The following pro forma financial information presents the combined results of operations as if the BROSCO facilities had been combined with us on January 1, 2022. The pro forma results are intended for information purposes only and do not purport to represent what the combined companies' results of operations would actually have been had the related transaction in fact occurred on January 1, 2022. They also do not reflect any cost savings, operating synergies, or revenue enhancements that we may achieve or the costs necessary to achieve these cost savings, operating synergies, revenue enhancements, or integration efforts.

	Pro Forma
		Three Months Ended September 30, 2023		Nine Months Ended September 30, 2023
	(unaudited, thousands)
Sales		$	1,881,799	$	5,341,208
Net income		$	145,153	$	397,346