The Company made various acquisitions during the nine months ended October 29, 2023 (the “Fiscal 2023 Acquisitions”) and the nine months ended October 30, 2022 (the "Fiscal 2022 Acquisitions") with an aggregate transaction value of $161 million and $110 million, subject to working capital adjustments, respectively. These transactions were funded with cash.

•On July 12, 2023, the Company acquired all of the outstanding shares of J.W. D’Angelo Company, Inc. (“Dangelo”). Dangelo has three locations and is a full-service provider of fire protection and waterworks products.

•On July 10, 2023, the Company acquired certain assets and assumed certain liabilities of Foster Supply Inc. and R.P. Foster Inc. (collectively, “Foster Supply”). Foster Supply has seven locations and is a full-service provider of precast concrete structures, pipe, drainage materials and related geosynthetics products.

•On April 17, 2023, the Company acquired certain assets and assumed certain liabilities of Midwest Pipe Supply Inc. (“Midwest Pipe”). Midwest Pipe has one location and is a distributor of drainage and waterworks products.

•On April 10, 2023, the Company acquired certain assets and assumed certain liabilities of UPSCO Manufacturing & Distribution Company, UPSCO, Inc. and TMB Holdings, LLC (collectively, “UPSCO”). UPSCO is a provider of utility infrastructure products and services.

•On March 6, 2023, the Company acquired certain assets and assumed certain liabilities of Landscape & Construction Supplies LLC (“Landscape & Construction Supplies”). Landscape & Construction Supplies has two locations and is a provider of geosynthetics products.

•On October 10, 2022, the Company acquired certain assets and assumed certain liabilities of Distributors, Inc. (“Distributors”). Distributors has one location and distributes fire protection products.

•On October 3, 2022, the Company acquired certain assets and assumed certain liabilities of the municipal waterworks division of Trumbull Industries, Inc., and acquired certain assets and assumed certain liabilities of an affiliated entity, Trumbull Manufacturing, Inc. (collectively “Trumbull”). Trumbull has three locations and distributes a variety of infrastructure products to the waterworks industry.

•On August 8, 2022, the Company acquired certain assets and assumed certain liabilities of Inland Water Works Supply, Co. (“Inland”). Inland has one location and distributes waterworks products.

•On June 28, 2022, the Company acquired certain assets and assumed certain liabilities of Earthsavers Erosion Control, LLC (“Earthsavers”). Earthsavers has three locations and produces and distributes a variety of geosynthetic materials, including wattles, erosion control blankets and a broad array of geotextile products.

•On May 2, 2022, the Company acquired certain assets and assumed certain liabilities of Lock City Supply, Inc. (“Lock City”). Lock City has one location and distributes waterworks products.

•On March 21, 2022, the Company acquired certain assets and assumed certain liabilities of Dodson Engineered Products, Inc. (“Dodson”). Dodson has one location and distributes waterworks products.

The following table represents the preliminary allocation of the transaction price to the fair value of identifiable assets acquired and liabilities assumed in the Fiscal 2023 Acquisitions and final allocation of the transaction price to the fair value of identifiable assets acquired and liabilities assumed in the Fiscal 2022 Acquisitions:


	Fiscal 2023 Acquisitions		Fiscal 2022 Acquisitions
Cash	$	5	$	—
Receivables	28		19
Inventories	38		36
Intangible assets	76		40
Goodwill	17		20
Property, plant and equipment	24		7
Operating lease right-of-use assets	7		5
Other assets, current and non-current	4		4
Total assets acquired	199		131
Accounts payable	9		9
Deferred income taxes	8		—

Operating lease liabilities, current and non-current	7		5
Deferred consideration	10		2
Other liabilities, current and non-current	6		1
Net assets acquired	$	159	$	114


	Fiscal 2023 Acquisitions		Fiscal 2022 Acquisitions
Net assets acquired	$	159	$	114
Less: Working capital adjustment	(3)		—
Less: Cash acquired in acquisition	(5)		—



Total consideration, net of cash; investing cash outflow	$	151	$	114

In the above transactions, to the extent applicable, the excess of purchase price over net tangible and intangible assets acquired resulted in goodwill, which represents the assembled workforce and anticipated long-term growth in new markets, customers and products. Goodwill of $3 million and $20 million associated with the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions, respectively, are fully deductible by the Company for U.S. income tax purposes.

For the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions discussed above, the Company valued the customer relationships as intangible assets acquired.

The customer relationship intangible assets represent the value associated with those customer relationships in place at the date of the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions. The Company valued the customer relationships using an excess earnings method using various inputs such as customer attrition rate, revenue growth rate, gross margin percentage and discount rate. Cash flows associated with the existing relationships are expected to diminish over time due to customer turnover. The Company reflected this expected diminishing cash flow through the utilization of an annual customer attrition rate assumption and in its method of amortization.

A summary of the intangible asset acquired and assumptions utilized in the valuation for the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions is as follows:


	Intangible Asset Amount		Weighted Average Amortization Period	Weighted Average Discount Rate		Weighted Average Attrition Rate
Customer Relationships
Fiscal 2023 Acquisitions	$	76	10 years	16.2	%	12.6	%
Fiscal 2022 Acquisitions	40		10 years	15.5	%	12.0	%

As a result of integration of the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions, including the consolidation of certain acquired and existing branches, it is impracticable to identify the explicit financial performance associated with the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions. As such, the Company has not presented the post-acquisition net sales and net income for the Fiscal 2023 Acquisitions and Fiscal 2022 Acquisitions.