Bloomia Acquisition

3 Months Ended

Mar. 31, 2025

Bloomia Acquisition

Bloomia Acquisition

3. Bloomia Acquisition

On February 22, 2024, the Company completed the acquisition of a majority interest in Fresh Tulips USA LLC and Bloomia and its subsidiaries (the “Acquisition”). The Acquisition was completed by the Company through its wholly owned subsidiaries, Tulp 24.1 and Tulipa Acquisitie Holding B.V. (“Tulipa”), pursuant to an Agreement for the Sale and Purchase of Shares by and among Tulp 24.1, Tulipa, Botman Bloembollen B.V., W.F. Jansen (“Jansen”), and H.J. Strengers, and Lendway, as the Guarantor. Jansen will continue to serve as chief executive officer of Bloomia following the Acquisition. As a result of the Acquisition, Tulp 24.1 became the holder of 100% of the ownership interests of Bloomia.

The Acquisition has been accounted for in accordance with ASC Topic 805, “Business Combinations,” using the acquisition method of accounting. Under the acquisition method of accounting, the total purchase price was allocated to the net identifiable tangible and intangible assets of Bloomia acquired, based on their fair values at the date of the acquisition.

The Acquisition was funded through a combination of debt and cash on hand. The total consideration transferred for the Acquisition was $53,360,000. Consideration comprised of $34,919,000 of cash paid, $15,451,000 of seller bridge loans in lieu of cash, and $2,990,000 of equity issued of Tulp 24.1, which is reflected as noncontrolling interest within these condensed consolidated financial statements. Following the noncontrolling equity issued, the Company owns 81.4% of Tulp 24.1 and the CEO of Bloomia owns the remaining 18.6%. Refer to Note 8 for further discussion on the debt used to finance the Acquisition.

The allocation of the purchase price to assets acquired and liabilities assumed is as follows:

Fair value of purchase consideration
Cash consideration	$	34,919,000
Equity in subsidiary issued (noncontrolling interest)		2,990,000
Seller bridge loans		15,451,000
Total fair value of consideration	$	53,360,000
Fair value of assets acquired and liabilities assumed:
Cash and cash equivalents	$	741,000
Accounts receivable		3,430,000
Inventories		12,493,000
Prepaid and other		2,359,000
Property and equipment		11,349,000
Intangible assets		26,870,000
Equity method investment		167,000
Finance lease - right of use assets		22,000
Operating lease - right of use assets		34,289,000
Other assets		358,000
Total assets acquired		92,078,000
Accounts payable		1,730,000
Accrued expenses		2,843,000
Finance lease liabilities - current		13,000
Operating lease liabilities - current		945,000
Finance lease liabilities - long-term		9,000
Operating lease liabilities - long-term		33,344,000
Deferred tax liabilities		10,722,000
Total liabilities assumed		49,606,000
Net identifiable assets acquired		42,472,000
Goodwill		10,888,000
Total consideration transferred	$	53,360,000

Unaudited pro forma information for the three months ended March 31, 2024, excluding the impact of debt and intangible asset amortization, is as follows:

	Three Months Ended
	March 31, 2024
Revenue, net	$	14,173,000
Net income attributable to Lendway		2,377,000

The Company incurred approximately $24,000 and $1,542,000 of acquisition-related costs during the three months ended March 31, 2025 and 2024, respectively.