Acquisitions, Divestitures and Discontinued Operations

3 Months Ended

Mar. 31, 2021

Acquisitions, Divestitures and Discontinued Operations

Acquisitions

The Company acquired several businesses for approximately $20,340 and $20,874, net of cash acquired, during the three months ended March 31, 2021 and March 31, 2020, respectively. The measurement period is still open for certain businesses acquired in prior periods, but there have been no significant measurement period adjustments from finalizing acquisition accounting during the three months ended March 31, 2021.

Divestitures

The Company received cash proceeds from divestitures of businesses totaling $10,345 and $10,442 for the three months ended March 31, 2021 and March 31, 2020, respectively.

Discontinued Operations

Business Products Group

During 2020, the Company completed the divestiture of its Business Products Group as part of its long-term strategic initiative to streamline its operations and optimize its portfolio so that it can drive shareholder value by focusing on its global Automotive and Industrial Parts Groups. This divestiture represented a single plan to exit the Business Products Group segment and was considered a strategic shift that had a major effect on the Company’s operations and financial results. Therefore, the results of operations, financial position and cash flows for the Business Products Group are reported as discontinued operations for all periods presented.

The Company retains an investment in S.P. Richard's (“SPR”), a business that previously belonged to the Business Products Group, with a carrying value of $70,883, which is included within other assets on the condensed consolidated balance sheets, as of March 31, 2021. The Company maintains an allowance equal to the current expected credit loss based on a consideration of

historical experience, current market conditions and reasonable and supportable forecasts related to this investment and other related assets of $17,000.

The Company also remains involved with SPR for a limited period of time through various lease, sublease, freight distribution and transition service agreements. The Company has concluded that SPR is a variable interest entity, but the Company is not the primary beneficiary and therefore the entity is not consolidated. Among other things, the Company does not have any voting rights and does not have the power to direct the activities that most significantly affect SPR's economic performance. For a limited period of time as SPR completes its transition away from the Company’s shared services platform, the Company continues to pay certain payables on SPR’s behalf and at SPR’s direction with full reimbursement from SPR under the terms of a transition services agreement.

The Company’s results of operations for discontinued operations were:


	Three Months Ended March 31, 2020
Net sales	$	467,006
Cost of goods sold	354,393
Gross profit	112,613
Operating and non-operating expenses	90,076
Loss on divestiture	4,185
Income before income taxes	18,352
Income taxes	4,163
Net income from discontinued operations	$	14,189