2. Business Acquisitions

The Company accounts for business combinations by recognizing the assets acquired and liabilities assumed at the acquisition date fair value. In valuing acquired assets and liabilities, fair value estimates use Level 3 inputs, including future expected cash flows and discount rates. Goodwill is measured as the excess of consideration transferred over the fair values of the assets acquired and the liabilities assumed. While the Company uses its best estimates and assumptions as a part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments arising from new facts and circumstances are recorded to the Consolidated Statements of Comprehensive Income. The results of operations of acquisitions are reflected in the Company’s Consolidated Financial Statements from the date of acquisition.

Fiscal 2018 Acquisitions

In fiscal 2018, the Company completed the following acquisitions, with an aggregate purchase price of $24.4 million of cash consideration, subject to finalization of certain working capital settlement amounts. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business.


Company Name	Form of Acquisition	Date of Acquisition
ASI Building Products, LLC	Purchase of net assets	August 1, 2017
Washington Builders Supply, Inc.	Purchase of net assets	October 2, 2017
Southwest Building Materials, Ltd.	Purchase of net assets	December 4, 2017
California-based distribution business of Grabber Construction Products, Inc.	Purchase of net assets	April 2, 2018
CMH Distributing, Inc.	Purchase of net assets	April 2, 2018

The preliminary allocation of consideration for these acquisitions is summarized as follows:


	Preliminary
	Purchase Price
	Allocation
		(in thousands)
Trade accounts and notes receivable	$	4,872
Inventories		4,321
Property and equipment		1,081
Tradenames		1,000
Vendor agreement		1,000
Other intangible assets		620
Customer relationships		9,358
Goodwill		4,145
Liabilities assumed		(1,951)
Purchase price	$	24,446

Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is all attributable to our one operating reportable segment. The goodwill and other intangible assets related to these acquisitions are expected to be deductible for U.S. federal income tax purposes. The Company believes that information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the Company is waiting for additional information necessary to finalize certain of those fair values, specifically, the finalization of working capital settlements. Thus, the provisional measurements of certain fair values set forth above are preliminary. Such changes are not expected to be significant. The Company expects to complete the purchase price allocation as soon as practicable, but no later than one year from the applicable acquisition date. The pro forma impact of these acquisitions is not presented as it is not considered material to the Company’s Consolidated Financial Statements.

Fiscal 2017 Acquisitions

In fiscal 2017, the Company completed the following acquisitions, with an aggregate purchase price of $154.0 million, comprised of $148.7 million of cash consideration and $5.3 million of consideration related to working capital settlements and contingent consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business.


Company Name	Form of Acquisition	Date of Acquisition
Wall & Ceiling Supply Co., Inc.	Purchase of net assets	May 2, 2016
Rockwise, LLC	Purchase of net assets	July 5, 2016
Steven F. Kempf Building Materials, Inc.	Purchase of net assets	August 29, 2016
Olympia Building Supplies, LLC/Redmill, Inc.	Purchase of 100% of outstanding common stock	September 1, 2016
United Building Materials, Inc.	Purchase of net assets	October 3, 2016
Ryan Building Materials, Inc.	Purchase of net assets	October 31, 2016
Interior Products Supply	Purchase of net assets	December 5, 2016
Hawaii-based distribution business of Grabber Construction Products, Inc.	Purchase of net assets	February 1, 2017

The allocation of consideration for these acquisitions is summarized as follows:


	Preliminary				Final
	Purchase Price		Adjustments/		Purchase Price
	Allocation		Reclassifications		Allocation
	(in thousands)
Cash and cash equivalents	$	1,558	$	—	$	1,558
Trade accounts and notes receivable		37,691		(63)		37,628
Inventories		16,504		—		16,504
Other current assets		657		14		671
Property and equipment		8,357		—		8,357
Tradenames		9,490		—		9,490
Customer relationships		64,660		—		64,660
Goodwill		37,728		(144)		37,584
Deferred tax liability		(6,011)		—		(6,011)
Liabilities assumed		(16,958)		560		(16,398)
Purchase price	$	153,676	$	367	$	154,043

During the year ended April 30, 2018, the Company recorded adjustments to working capital for fiscal 2017 acquisitions resulting in an increase in total consideration paid of $0.4 million. Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is all attributable to our one operating reportable segment. Goodwill of $25.4 million and other intangible assets of $53.6 million related to these acquisitions are expected to be deductible for U.S. federal income tax purposes. Goodwill of $12.2 million and other intangibles of $20.6 million are nondeductible for U.S. federal income tax purposes.

Fiscal 2016 Acquisitions

In fiscal 2016, the Company completed the following acquisitions, with an aggregate purchase price of $117.2 million, comprised of $114.8 million of cash consideration and $2.4 million of contingent consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company and grow the business.


Company Name	Form of Acquisition	Date of Acquisition
Tri-Cities Drywall & Supply Co.	Purchase of net assets	September 29, 2015
Badgerland Supply, Inc.	Purchase of net assets	November 2, 2015
Hathaway & Sons, Inc.	Purchase of net assets	November 9, 2015
Gypsum Supply Company	Purchase of 100% of outstanding common stock	January 1, 2016
Robert N. Karpp Co., Inc.	Purchase of net assets	February 1, 2016
Professional Handling & Distribution, Inc.	Purchase of net assets	February 1, 2016
M.R. Lee Building Materials, Inc.	Purchase of net assets	April 4, 2016

The allocation of consideration for these acquisitions is summarized as follows:


	Final
	Purchase Price
	Allocation
	(in thousands)
Cash and cash equivalents	$	953
Trade accounts and notes receivable		26,988
Inventories		17,703
Property and equipment		9,236
Other assets		808
Tradenames		12,500
Below market leases		2,020
Customer relationships		29,055
Goodwill		38,399
Deferred tax liability		(6,676)
Liabilities assumed		(13,805)
Purchase price	$	117,181