Acquisitions

3 Months Ended

Mar. 31, 2020

Acquisitions

Acquisitions

11. Acquisitions

During the three months ended March 31, 2019, subsidiaries of the Company acquired the assets of two RV dealerships that constituted businesses under accounting rules. The Company used a combination of cash and floor plan financing to complete the acquisitions. The Company considers acquisitions of independent dealerships to be a fast and capital efficient alternative to opening new RV and Outdoor Retail locations to expand its business and grow its customer base. The acquired businesses were recorded at their estimated fair values under the acquisition method of accounting. The balance of the purchase prices in excess of the fair values of net assets acquired were recorded as goodwill.

During the three months ended March 31, 2019, the RV and Outdoor Retail segment acquired the assets of an RV dealership group comprised of two locations for an aggregate purchase price of approximately $21.2 million. The purchases were partially funded through $8.4 million of borrowings under the Floor Plan Facility. For the three months ended March 31, 2019, the Company purchased real property of $0.7 million from parties related to the sellers of the businesses.

The estimated fair values of the assets acquired and liabilities assumed for the acquisitions of dealerships, retail and consumer shows consist of the following:

	Three Months Ended March 31,
($ in thousands)	2020		2019
Tangible assets (liabilities) acquired (assumed):
Inventories, net	$	(4)	$	9,096
Prepaid expenses and other assets		—		87
Property and equipment, net		—		105
Accrued liabilities		—		(100)
Total tangible net assets acquired		(4)		9,188
Goodwill		4		11,981
Purchase price		—		21,169
Cash and cash equivalents acquired		—		—
Cash paid for acquisitions, net of cash acquired		—		21,169
Inventory purchases financed via floor plan		—		(8,416)
Cash payment net of floor plan financing	$	—	$	12,753

For the three months ended March 31, 2020, the fair values above represent measurement period adjustments for valuation of acquired inventories relating to dealership acquisitions during the year ended December 31, 2019. The primary items that generated the goodwill are the value of the expected synergies between the acquired businesses and the Company and the acquired assembled workforce, neither of which qualify for recognition as a separately identified intangible asset. For the three months ended March 31, 2020 and 2019, acquired goodwill of $0 million and $12.0 million, respectively, is expected to be deductible for tax purposes. Included in the three months ended March 31, 2019 consolidated financial results were $4.8 million of revenue and $0.3 million of pre-tax loss of the acquired dealerships from the applicable acquisition dates. Pro forma information on these acquisitions has not been included, because the Company has deemed them to not be individually or cumulatively material.