FlexSteel Acquisition (Tables)

6 Months Ended

Jun. 30, 2023

Business Combination and Asset Acquisition [Abstract]

The estimated purchase price consideration for the acquisition is $630.1 million and is summarized as follows:


	Purchase Price Consideration
Cash consideration	$	624,173
Add: Estimated contingent consideration (1)	5,960
Fair value of consideration transferred or estimated to be transferred	$	630,133

(1) Represents the estimated fair value as of the acquisition date of the earn-out payment of up to $75 million of additional cash consideration if certain revenue growth targets are met by FlexSteel. The estimated fair value of the earn-out payment was determined using a Monte Carlo simulation valuation methodology based on probability-weighted performance projections and other inputs, including a discount rate.

Summary of Preliminary Purchase Price Allocation

The following table provides the preliminary allocation of the purchase price as of the acquisition date. The goodwill reflected below increased $1.5 million from the original preliminary purchase price allocation as a result of measurement period adjustments, primarily related to valuation adjustments to inventories and property and equipment.


Cash and cash equivalents	$	5,316
Receivables	57,747
Inventories	91,746
Prepaid expenses and other current assets	1,283
Property and equipment	210,100
Operating lease right-of-use assets	1,021
Identifiable intangible assets	200,300
Other noncurrent assets	5,666
Total assets acquired	573,179
Accounts payable	(14,789)
Accrued expenses and other current liabilities	(26,827)
Finance lease obligations	(974)
Operating lease liabilities	(906)
Deferred tax liabilities	(94,532)
Total liabilities assumed	(138,028)

Net assets acquired	435,151

Goodwill	$	194,982

Summary of Unaudited Proforma Results

The unaudited pro forma financial information is presented for informational purposes only and is neither indicative of the results of operations that would have occurred if the acquisition had taken place at the beginning of the period presented nor indicative of future operating results.


	Three Months Ended June 30,		Six Months Ended June 30,
	2022		2023		2022
Revenues	$	262,526	$	587,603	$	490,992
Net Income attributable to Cactus, Inc.	31,634		79,011		49,521