Acquisitions, Goodwill And Other Intangible Assets

3 Months Ended

Mar. 31, 2019

Acquisitions, Goodwill And Other Intangible Assets [Abstract]

Goodwill And Other Intangible Assets

ACQUISITIONS, GOODWILL AND OTHER INTANGIBLE ASSETS

Smoker Craft Furniture

In November 2018, the Company acquired the business and certain assets of the furniture manufacturing operation of Smoker Craft Inc., a leading pontoon, aluminum fishing, and fiberglass boat manufacturer located in New Paris, Indiana. The purchase price was $28.1 million paid at closing. The results of the acquired business have been included primarily in the Company’s OEM Segment and in the Consolidated Statements of Income since the acquisition date. The Company is validating account balances and finalizing the valuation for the acquisition.

The acquisition of this business was preliminarily recorded on the acquisition date as follows (in thousands):

Cash consideration	$	28,091
Customer relationship and other identifiable intangible assets	$	16,730
Net tangible assets	1,357
Total fair value of net assets acquired	$	18,087
Goodwill (tax deductible)	$	10,004

The customer relationship intangible asset is being amortized over its estimated useful life of 15 years. The consideration given was greater than the fair value of the net assets acquired, resulting in goodwill, because the Company anticipates the attainment of synergies and an increase in the markets for the acquired products.

ST.LA. S.r.l.

In June 2018, the Company acquired 100 percent of the equity interests of ST.LA. S.r.l., a manufacturer of bed lifts and other RV components for the European caravan market, headquartered in Pontedera, Italy. The purchase price was $14.8 million, net of cash acquired, paid at closing, and is subject to potential post-closing adjustments related to net working capital. The results of the acquired business have been included primarily in the Company’s OEM Segment and in the Consolidated Statements of Income since the acquisition date. The Company is validating account balances and finalizing the valuation for the acquisition. The acquisition of this business was preliminarily recorded on the acquisition date as follows (in thousands):

Cash consideration, net of cash acquired	$	14,845
Customer relationships and other identifiable intangible assets	$	7,000
Net tangible assets	351
Total fair value of net assets acquired	$	7,351
Goodwill (not tax deductible)	$	7,494

The customer relationships intangible asset is being amortized over its estimated useful life of 15 years. The consideration given was greater than the fair value of the net assets acquired, resulting in goodwill, because the Company anticipates the attainment of synergies and an increase in the markets for the acquired products.

Goodwill

Goodwill by reportable segment was as follows:

(In thousands)	OEM Segment		Aftermarket Segment		Total
Net balance – December 31, 2018	$	160,257	$	19,911	$	180,168
Other	(1,732)		(100)		(1,832)
Net balance – March 31, 2019	$	158,525	$	19,811	$	178,336

Goodwill represents the excess of the total consideration given in an acquisition of a business over the fair value of the net tangible and identifiable intangible assets acquired. Goodwill is not amortized, but instead is tested at the reporting unit level for impairment annually in November, or more frequently if certain circumstances indicate a possible impairment may exist.

Any change in the goodwill amounts resulting from foreign currency translations and purchase accounting adjustments are presented as “Other” in the above table.

Other Intangible Assets

Other intangible assets consisted of the following at March 31, 2019:

(In thousands)	Gross Cost		Accumulated Amortization		Net Balance		Estimated Useful Life in Years
Customer relationships	$	192,853	$	58,682	$	134,171	6	to	16
Patents	58,730		41,350		17,380		3	to	19
Trade names (finite life)	10,832		5,847		4,985		3	to	15
Trade names (indefinite life)	7,600		—		7,600		Indefinite
Non-compete agreements	6,864		4,580		2,284		3	to	6
Other	309		149		160		2	to	12
Purchased research and development	4,687		—		4,687		Indefinite
Other intangible assets	$	281,875	$	110,608	$	171,267

Other intangible assets consisted of the following at December 31, 2018:

(In thousands)	Gross Cost		Accumulated Amortization		Net Balance		Estimated Useful Life in Years
Customer relationships	$	191,919	$	54,889	$	137,030	6	to	16
Patents	58,787		40,079		18,708		3	to	19
Trade names (finite life)	10,885		5,507		5,378		3	to	15
Trade names (indefinite life)	7,600		—		7,600		Indefinite
Non-compete agreements	6,919		4,148		2,771		3	to	6
Other	309		141		168		2	to	12
Purchased research and development	4,687		—		4,687		Indefinite
Other intangible assets	$	281,106	$	104,764	$	176,342

Acquisitions

ACQUISITIONS, GOODWILL AND OTHER INTANGIBLE ASSETS

Smoker Craft Furniture

In November 2018, the Company acquired the business and certain assets of the furniture manufacturing operation of Smoker Craft Inc., a leading pontoon, aluminum fishing, and fiberglass boat manufacturer located in New Paris, Indiana. The purchase price was $28.1 million paid at closing. The results of the acquired business have been included primarily in the Company’s OEM Segment and in the Consolidated Statements of Income since the acquisition date. The Company is validating account balances and finalizing the valuation for the acquisition.

The acquisition of this business was preliminarily recorded on the acquisition date as follows (in thousands):

Cash consideration	$	28,091
Customer relationship and other identifiable intangible assets	$	16,730
Net tangible assets	1,357
Total fair value of net assets acquired	$	18,087
Goodwill (tax deductible)	$	10,004

The customer relationship intangible asset is being amortized over its estimated useful life of 15 years. The consideration given was greater than the fair value of the net assets acquired, resulting in goodwill, because the Company anticipates the attainment of synergies and an increase in the markets for the acquired products.

ST.LA. S.r.l.

In June 2018, the Company acquired 100 percent of the equity interests of ST.LA. S.r.l., a manufacturer of bed lifts and other RV components for the European caravan market, headquartered in Pontedera, Italy. The purchase price was $14.8 million, net of cash acquired, paid at closing, and is subject to potential post-closing adjustments related to net working capital. The results of the acquired business have been included primarily in the Company’s OEM Segment and in the Consolidated Statements of Income since the acquisition date. The Company is validating account balances and finalizing the valuation for the acquisition. The acquisition of this business was preliminarily recorded on the acquisition date as follows (in thousands):

Cash consideration, net of cash acquired	$	14,845
Customer relationships and other identifiable intangible assets	$	7,000
Net tangible assets	351
Total fair value of net assets acquired	$	7,351
Goodwill (not tax deductible)	$	7,494

The customer relationships intangible asset is being amortized over its estimated useful life of 15 years. The consideration given was greater than the fair value of the net assets acquired, resulting in goodwill, because the Company anticipates the attainment of synergies and an increase in the markets for the acquired products.

Goodwill

Goodwill by reportable segment was as follows:

(In thousands)	OEM Segment		Aftermarket Segment		Total
Net balance – December 31, 2018	$	160,257	$	19,911	$	180,168
Other	(1,732)		(100)		(1,832)
Net balance – March 31, 2019	$	158,525	$	19,811	$	178,336

Goodwill represents the excess of the total consideration given in an acquisition of a business over the fair value of the net tangible and identifiable intangible assets acquired. Goodwill is not amortized, but instead is tested at the reporting unit level for impairment annually in November, or more frequently if certain circumstances indicate a possible impairment may exist.

Any change in the goodwill amounts resulting from foreign currency translations and purchase accounting adjustments are presented as “Other” in the above table.

Other Intangible Assets

Other intangible assets consisted of the following at March 31, 2019:

(In thousands)	Gross Cost		Accumulated Amortization		Net Balance		Estimated Useful Life in Years
Customer relationships	$	192,853	$	58,682	$	134,171	6	to	16
Patents	58,730		41,350		17,380		3	to	19
Trade names (finite life)	10,832		5,847		4,985		3	to	15
Trade names (indefinite life)	7,600		—		7,600		Indefinite
Non-compete agreements	6,864		4,580		2,284		3	to	6
Other	309		149		160		2	to	12
Purchased research and development	4,687		—		4,687		Indefinite
Other intangible assets	$	281,875	$	110,608	$	171,267

Other intangible assets consisted of the following at December 31, 2018:

(In thousands)	Gross Cost		Accumulated Amortization		Net Balance		Estimated Useful Life in Years
Customer relationships	$	191,919	$	54,889	$	137,030	6	to	16
Patents	58,787		40,079		18,708		3	to	19
Trade names (finite life)	10,885		5,507		5,378		3	to	15
Trade names (indefinite life)	7,600		—		7,600		Indefinite
Non-compete agreements	6,919		4,148		2,771		3	to	6
Other	309		141		168		2	to	12
Purchased research and development	4,687		—		4,687		Indefinite
Other intangible assets	$	281,106	$	104,764	$	176,342