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Acquisitions
 9 Months Ended
Sep. 28, 2019
Business Combinations [Abstract]  
Acquisitions Acquisitions
Mountain Valley Acquisition
In October 2018, DSS acquired Mountain Valley, a growing American brand of spring and sparkling bottled water delivered to homes and offices throughout the United States (the “Mountain Valley Acquisition”). The initial purchase price paid by DSS in the Mountain Valley Acquisition was $80.4 million on a debt and cash free basis. The post-closing working capital adjustment was resolved in February 2019 by the payment of $0.4 million by the former owners of Mountain Valley to DSS. The Mountain Valley Acquisition was funded through a combination of incremental borrowings under the Company’s ABL facility and cash on hand.
The total consideration paid by DSS in the Mountain Valley Acquisition is summarized below:
(in millions of U.S. dollars)

Cash paid to sellers
$
62.5

Cash paid on behalf of sellers for sellers' transaction expenses
1.8

Cash paid to retire outstanding debt on behalf of sellers
16.1

Working capital settlement
(0.4
)
Total consideration
$
80.0


    
The Mountain Valley Acquisition supported the Company’s strategy to expand its existing home and office bottled water category into premium spring, sparkling and flavored water. The Company has accounted for this transaction as a business combination, which requires that assets acquired and liabilities assumed be measured at their acquisition date fair values.
The adjusted purchase price of $80.0 million has been allocated to the assets acquired and liabilities assumed based on management’s estimates of their fair values as of the acquisition date. The excess of the adjusted purchase price over the aggregate fair values was recorded as goodwill. Measurement period adjustments include adjustments to property, plant and equipment and intangible assets based on a valuation of such assets, as well as the assumed customer bottle deposit liability based on a review by management.
The table below summarizes the originally reported estimated acquisition date fair values, measurement period adjustments recorded and the final purchase price allocation of the assets acquired and liabilities assumed:
(in millions of U.S. dollars)
Originally Reported

Measurement Period Adjustments

Acquired Value
Cash and cash equivalents
$
8.2


$
—


$
8.2

Accounts receivable
4.2


—


4.2

Inventory
2.3


—


2.3

Prepaid expenses and other assets
0.2


—


0.2

Property, plant and equipment
38.5


3.0


41.5

Goodwill
20.5


(4.5
)

16.0

Intangible assets
25.8


2.6


28.4

Accounts payable and accrued liabilities
(19.3
)

(1.5
)

(20.8
)
Total
$
80.4


$
(0.4
)

$
80.0



Crystal Rock Acquisition
In March 2018, the Company completed the acquisition of Crystal Rock, a direct-to-consumer home and office water, coffee and filtration business serving customers throughout New York and New England. The transaction was structured as a merger following a cash tender offer for all outstanding shares of Crystal Rock, with Crystal Rock becoming a wholly-owned indirect subsidiary of the Company (the “Crystal Rock Acquisition”). The aggregate consideration paid was $37.7 million and includes the purchase price paid to the Crystal Rock shareholders of $20.7 million, $0.8 million in costs paid on behalf of the sellers for the seller’s transaction costs and $16.2 million of assumed debt and accrued interest obligations of Crystal Rock that was paid by the Company.

The total consideration paid by the Company in the Crystal Rock Acquisition is summarized below:
(in millions of U.S. dollars)
 
Cash paid to sellers
$
20.7

Cash paid on behalf of sellers for sellers’ transaction expenses
0.8

Total consideration
$
21.5


The Crystal Rock Acquisition strengthens the Company’s presence in New York and New England. The Company has accounted for this transaction as a business combination, which requires that assets acquired and liabilities assumed be measured at their acquisition date fair values.
The purchase price of $21.5 million, net of debt, was allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. The excess of the purchase price over the aggregate fair values was recorded as goodwill. Measurement period adjustments include adjustments to property, plant and equipment and intangible assets based on review of valuations, adjustments to deferred taxes and other long-term liabilities based on analysis of certain tax positions, as well as adjustments to accounts receivable, inventory, prepaid expenses, other assets and accounts payable and accrued liabilities based on review of their fair values as of the acquisition date. These measurement period adjustments did not have a material effect on our results of operations in prior periods.
The table below summarizes the originally reported estimated acquisition date fair values, measurement period adjustments recorded and the final purchase price allocation of the assets acquired and liabilities assumed:
(in millions of U.S. dollars)
Originally Reported

Measurement Period Adjustments

Acquired Value
Cash and cash equivalents
$
1.6


$
—


$
1.6

Accounts receivable
6.5


(0.1
)

6.4

Inventory
2.3


(0.1
)

2.2

Prepaid expenses and other current assets
1.2


1.0


2.2

Property, plant and equipment
9.4


(0.5
)

8.9

Goodwill
16.7


(2.5
)

14.2

Intangible assets
13.3


(0.7
)

12.6

Other assets
0.8


(0.7
)

0.1

Short-term borrowings
(4.1
)

—


(4.1
)
Current maturities of long-term debt
(1.6
)

—


(1.6
)
Accounts payable and accrued liabilities
(5.2
)

(1.5
)

(6.7
)
Long-term debt
(10.4
)

—


(10.4
)
Deferred tax liabilities
(6.5
)

3.5


(3.0
)
Other long-term liabilities
(2.5
)

1.6


(0.9
)
Total
$
21.5


$
—


$
21.5


During the second quarter of 2018, Crystal Rock was integrated within our DSS business.