The Company accounts for business combinations by recognizing the assets acquired and liabilities assumed at the acquisition date fair value. In valuing certain 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 to 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 Operations and Comprehensive Income. The results of operations of acquisitions are reflected in the Company’s Consolidated Financial Statements from the date of acquisition. The Company's Consolidated Statement of Operations and Comprehensive Income for the year ended April 30, 2024 included $71.5 million of net sales and $5.4 million of net loss from acquisitions made in fiscal 2024. The Company recorded transaction costs of $4.9 million, $2.0 million and $3.5 million during the years ended April 30, 2024, 2023 and 2022, respectively.

In fiscal 2024, the Company completed the following acquisitions, with an aggregate preliminary purchase price of $380.0 million of cash consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company, expand the Company's complementary product offerings and grow the business.

On May 1, 2023, the Company acquired Jawl Lumber Corporation ("Jawl"), which provides services to the Vancouver Island market in Canada under the Home Lumber and Building Supplies ("Home Lumber") brand name. Home Lumber is a leading supplier of lumber, engineered wood, doors, framing packages and siding as well as other key complementary building materials in the Vancouver Island market. Home Lumber operates from a single location in Victoria, Canada. The primary purpose of the transaction was to expand the geographical coverage of the Company and grow the business.

On October 1, 2023, the Company acquired AMW Construction Supply, LLC ("AMW"), a tools and fasteners and other complementary products distributor servicing the Phoenix, Arizona metro area. AMW operates from a single location in Phoenix, Arizona. The primary purpose of the transaction was to expand the Company's complementary product offerings and grow the business.

On March 1, 2024, the Company acquired Kamco Supply Corporation and affiliates ("Kamco"), a leading regional supplier of ceilings, wallboard, steel, lumber, and other related construction products. Kamco operates five distribution facilities in the greater New York City area and services the New York metro and tri-state area. The transaction was funded with cash on hand and borrowings under the Company’s revolving credit facility. The primary purpose of the transaction was to expand the geographical coverage of the Company and grow the business.

The assets acquired and liabilities assumed were recognized at their acquisition date fair values. The acquisition accounting is subject to change as the Company obtains additional information during the measurement period about the facts and circumstances that existed as of the acquisition dates. The primary areas of the preliminary acquisition accounting that are not yet finalized relate to preliminary fair value estimates, working capital adjustments and residual goodwill.


	Initial Acquisition Accounting		Adjustments		Updated Acquisition Accounting
	(in thousands)
Cash	$	3,028	$	—	$	3,028
Trade accounts and notes receivable	37,355		154		37,509
Inventories	25,713		37		25,750
Prepaid and other current assets	411		(32)		379
Property and equipment	17,035		—		17,035
Operating lease right-of-use assets	61,703		—		61,703
Customer relationships	124,954		(4,353)		120,601
Trade names	44,064		(664)		43,400
Non-compete agreements	4,600		—		4,600
Goodwill	151,726		3,700		155,426
Accounts payable and accrued expenses	(21,925)		(208)		(22,133)
Operating lease liabilities	(61,703)		—		(61,703)
Deferred income taxes	(6,586)		963		(5,623)
Fair value of consideration transferred	$	380,375	$	(403)	$	379,972

Goodwill recognized is attributable to synergies achieved through the streamlining of operations combined with improved margins attainable through increased market presence and is attributable to the Company's geographic divisions reportable segment. Goodwill of $17.2 million is not expected to be deductible for U.S. federal income tax purposes, and goodwill of $138.2 million is expected to be deductible for U.S. federal income tax purposes. The estimated useful life for the customer relationships is 12.1 years, the estimated useful life for the trade names is 15 years and the estimated useful lives for the non-competition agreements is 5.0 years.

The above pro forma results have been calculated by combining the historical results of the Company, Jawl, AMW and Kamco as if the acquisitions of Jawl, AMW and Kamco had occurred on May 1, 2022, the first day of the comparable prior reporting period. The pro forma results include estimates for intangible asset amortization, depreciation, interest expense and income taxes. The pro forma information is not necessarily indicative of the results that would have been achieved had the transactions occurred on the first day of each of the periods presented or that may be achieved in the future.

In fiscal 2023, the Company completed the following acquisitions, with an aggregate purchase price of $60.5 million of cash consideration. The purpose of these acquisitions was to expand the geographical coverage of the Company, expand the Company's complementary product offerings and grow the business. The impact of these acquisitions was not material to the Company’s Consolidated Financial Statements.

Company Name

Form of Acquisition

Date of Acquisition

Construction Supply of Southwest Florida, Inc.

Purchase of net assets

June 1, 2022

Tanner Bolt and Nut, Inc.

Purchase of net assets

December 30, 2022

Blair Building Materials, Inc.

Purchase of net assets

April 3, 2023

Engler, Meier and Justus, Inc.

Purchase of 100% of outstanding common stock

April 3, 2023


	Preliminary Acquisition Accounting		Adjustments		Final Acquisition Accounting
	(in thousands)
Trade accounts and notes receivable	$	20,267	$	(959)	$	19,308
Inventories	16,768		54		16,822
Prepaid and other current assets	542		(138)		404
Property and equipment	4,689		—		4,689
Operating lease right-of-use assets	6,894		—		6,894
Customer relationships	14,039		—		14,039
Trade names	4,614		—		4,614
Goodwill	10,697		(822)		9,875
Accounts payable and accrued expenses	(9,091)		—		(9,091)
Operating lease liabilities	(6,894)		—		(6,894)
Deferred income taxes	(793)		609		(184)
Fair value of consideration transferred	$	61,732	$	(1,256)	$	60,476

reportable segment. Goodwill of $5.4 million is deductible for U.S. federal income tax purposes. Goodwill of $4.5 million is not deductible for U.S. federal income tax purposes. The weighted average estimated useful life for customer relationships is 9.5 years and the weighted average estimated useful life for trade names is 15 years.

On July 1, 2021, the Company acquired substantially all of the assets of Westside Building Material (“Westside”), one of the largest independent distributors of interior building products in the U.S., for consideration of $140.1 million in cash. Westside is a leading supplier of steel framing, wallboard, ceilings, insulation and complementary building products serving commercial and residential markets. Westside’s distribution network comprises ten locations, including nine across California (Anaheim, Hesperia, Oakland, Chatsworth, Fresno, Lancaster, Santa Maria, San Diego and National City) and one in Las Vegas, Nevada. The acquisition was funded with cash on hand and borrowings under the Company's asset based revolving credit facility. The primary purpose of the transaction was to expand the geographical coverage of the Company and grow the business.

During the year ended April 30, 2023, the Company settled its $13.5 million holdback liability related to the acquisition of Westside in accordance with the terms of the purchase agreement. The holdback liability was for general representations and warranties of the sellers and was settled 15 months after the acquisition date.


	Initial Acquisition Accounting		Adjustments		Final Acquisition Accounting
	(in thousands)
Trade accounts and notes receivable	$	27,081	$	(799)	$	26,282
Inventories	28,900		(948)		27,952
Prepaid and other current assets	228		—		228
Property and equipment	16,687		—		16,687
Operating lease right-of-use assets	20,782		—		20,782
Customer relationships	51,500		—		51,500
Trade names	11,300		—		11,300
Goodwill	13,351		2,625		15,976
Accounts payable and accrued expenses	(14,375)		(405)		(14,780)
Operating lease liabilities	(15,819)		—		(15,819)
Fair value of consideration transferred	$	139,635	$	473	$	140,108

On December 1, 2021, the Company acquired Ames Taping Tools Holding LLC (“Ames”) for consideration of $226.7 million in cash. Ames is the leading provider of automatic taping and finishing (“ATF”) tools and related products to the professional drywall finishing industry. As of the acquisition date, Ames operated nearly 100 retail locations servicing professionals in the interior finishing market. The acquisition was primarily funded with borrowings under the Company's asset based revolving credit facility. The primary purpose of the transaction was to expand the Company's complementary product offerings and grow the business.


	Initial Acquisition Accounting		Adjustments		Final Acquisition Accounting
	(in thousands)
Cash and cash equivalents	$	10,692	$	—	$	10,692
Trade accounts and notes receivable	9,955		(54)		9,901
Inventories	15,464		870		16,334
Prepaid and other current assets	1,941		—		1,941
Property and equipment	6,165		—		6,165
Operating lease right-of-use assets	8,238		(235)		8,003
Customer relationships	63,000		(3,000)		60,000
Trade names	53,000		(4,000)		49,000
Patents	3,000		—		3,000
Goodwill	104,557		2,822		107,379
Accounts payable and accrued expenses	(14,827)		3,170		(11,657)
Deferred tax liability	(28,440)		2,355		(26,085)
Operating lease liabilities	(8,238)		235		(8,003)
Fair value of consideration transferred	$	224,507	$	2,163	$	226,670

Goodwill recognized is attributable to expected synergies and the expected value in the potential to expand and enhance the Company's complementary product offerings and is attributable to the Company's other reportable segment. Goodwill is not deductible for U.S. federal income tax purposes. The estimated useful life for the customer relationships is 11 years and the estimated useful life for the patents is 10 years. Trade names valued at $26.0 million have an estimated useful life of 15 years and trade names valued at $23.0 million have an indefinite useful life.

On June 3, 2021, the Company acquired the assets of Architectural Coatings Distributors, Inc. (“Architectural Coating”). Architectural Coating is an interior building products distributor in Cleveland, Ohio. On August 2, 2021, the Company acquired certain assets of DK&B Construction Specialties, Inc. (“DK&B”). DK&B is a distributor of External Insulation and Finishing Systems (“EIFS”) and stucco products through one location in Omaha, Nebraska. On December 1, 2021, the Company acquired the assets of Kimco Supply Company (“Kimco”). Kimco sells building and construction supplies through two locations in the Tampa, Florida area. The impact of these acquisitions is not material to the Company’s Consolidated Financial Statements.