Business Acquisitions and Divestitures Business Acquisitions and Divestitures (Notes)

6 Months Ended

Sep. 30, 2022

Business Acquisitions and Divestitures [Abstract]

Business Acquisitions

During the second quarter of fiscal 2023, we completed a tuck-in acquisition, which continued to expand our product and service offerings in the Healthcare segment. Total aggregate consideration was approximately $21,892, including contingent deferred consideration of $6,700. Acquisition related costs are reported in the selling, general, and administrative expense line of the Consolidated Statements of Income and such amounts are not material. Purchase price allocation will be finalized within a measurement period not to exceed one year from closing.

On June 2, 2021, we acquired all outstanding equity interests in Cantel Medical LLC ("Cantel") through a U.S. subsidiary.The total consideration for Cantel common stock and stock equivalents was $3,599,471. We funded the cash portion of the transaction consideration and repayment of a significant amount of Cantel’s existing debt obligations with a portion of the proceeds from new debt, which is described in our Annual Report on Form 10-K for the year ended March 31, 2022, which was filed with the SEC on May 31, 2022.

In addition to the total purchase consideration, STERIS assumed and repaid $721,284 of existing Cantel debt obligations and assumed Cantel's obligations associated with convertible senior notes issued on May 15, 2020, which is described in our Annual Report on Form 10-K for the year ended March 31, 2022, which was filed with the SEC on May 31, 2022.

Fair Value of Assets Acquired and Liabilities Assumed

The table below presents the allocation of fair values of assets acquired and liabilities assumed on the acquisition date.


	March 31, 2022
	(As previously reported)		Adjustments		Final
Cash	$	169,073	$	—	$	169,073
Accounts receivable	172,226		—		172,226
Inventory	249,221		—		249,221
Property, plant and equipment	267,360		(1,282)		266,078
Lease right-of-use assets, net	59,720		—		59,720
Other assets	72,864		—		72,864
Intangible assets	2,942,000		—		2,942,000
Goodwill	1,522,381		22,088		1,544,469
Total assets acquired	5,454,845		20,806		5,475,651
Convertible debt, par value	168,000		—		168,000
Other current liabilities	247,549		5,595		253,144
Long-term lease obligations	47,856		—		47,856
Deferred income taxes, net	670,685		15,211		685,896
Long-term indebtedness	721,284		—		721,284
Total liabilities assumed	1,855,374		20,806		1,876,180
Net assets acquired	$	3,599,471	$	—	$	3,599,471

Acquisition and integration expenses totaled $3,844 and $13,676 for the three and six months ended September 30, 2022, respectively. Acquisition and integration expenses totaled $17,404 and $158,400 for the three and six months ended September 30, 2021, respectively. These costs were primarily related to the acquisition and integration of Cantel. Acquisition and integration expenses are reported in the selling, general and administrative expenses line of our Consolidated Statements of Income and include but are not limited to investment banker, advisory, legal, other professional fees, and certain employee-related expenses.

During the second quarter of fiscal 2023, in connection with the preparation of our quarterly consolidated financial statements, we identified and recognized a goodwill impairment loss of $490,565 related to goodwill that arose with respect to assets acquired in the Cantel acquisition. For more information on the impairment loss, see Note 17 to our consolidated financial statements, titled "Goodwill."

For more information on the acquisition of Cantel, refer to our Annual Report on Form 10-K for the year ended March 31, 2022, which was filed with the SEC on May 31, 2022.