Business Combinations

9 Months Ended

Sep. 30, 2018

Business Combinations [Abstract]

Business Combinations

NOTE 12 – BUSINESS COMBINATIONS

In January 2018, the Company acquired The Future Customer (“TFC”), a leading boutique loyalty strategy and marketing company based in London (U.K.)  The acquisition of TFC enhanced and extended the Company’s customer loyalty business to Europe.  

In August 2018, the Company acquired the disaster management and recovery firm, DMS Disaster Consultants (“DMS”).  DMS assists public sector clients with man-made and natural disaster planning and preparedness, and post-disaster response and recovery efforts by assisting clients in obtaining funding from Federal Emergency Management Agency (FEMA), insurance companies, and other sources.

The combined purchase consideration for these acquisitions was $24.9 million, which included $22.8 million of initial cash payments and $1.2 million estimated the fair value (Level 3) of contingent consideration to be paid to the former owners if certain objectives are achieved.  The Company recognized the fair value of the assets acquired and liabilities assumed and allocated $17.9 million to goodwill and $5.1 million to intangible assets. The intangible assets primarily consist of customer relationships and are amortized on an accelerated basis based on projected customer payments. The Company determined the fair value of the contingent consideration as of each acquisition date using a valuation model which included the most likely outcome and the application of an appropriate discount rate. At the end of the reporting period, the fair value of the contingent consideration will be remeasured and any changes will be recorded in current operations. There were no material remeasurements recorded through September 30, 2018. The acquisitions were not significant to the Company’s financial statements taken as a whole.