Business Acquisitions and Divestitures

3 Months Ended

Nov. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Acquisitions

On November 1, 2023, the Company completed the acquisition of ProcureAbility Inc. (“ProcureAbility”) for approximately $60 million in cash. ProcureAbility is a procurement services provider specializing in technology-enabled advisory, managed services, digital, staffing, and recruiting solutions.

The acquisition of ProcureAbility assets was accounted for as a business combination using the acquisition method of accounting. Assets acquired of $86 million, including $40 million in intangible assets and $38 million in goodwill, and liabilities assumed of $25 million were recorded at their estimated fair values as of the acquisition date. The allocation of the purchase price is considered preliminary pending final valuation for the Company. The excess of the purchase price over the fair value of the acquired assets and assumed liabilities was recorded to goodwill and was fully allocated to the DMS segment. The majority of the goodwill is currently not expected to be deductible for income tax purposes. The results of operations were

included in the Company’s condensed consolidated financial results beginning on November 1, 2023. Pro forma information has not been provided as the acquisition of ProcureAbility is not deemed to be significant.

Divestitures

The Company announced on September 26, 2023 that, through its indirect subsidiary, Jabil Circuit (Singapore) Pte. Ltd., a Singapore private limited company (“Singapore Seller”), it agreed to sell to an affiliate of BYD Electronic (International) Co. Ltd., a Hong Kong limited liability company (“Purchaser” or “BYDE”), its product manufacturing business in Chengdu, including its supporting component manufacturing in Wuxi (the “Business”) for cash consideration of approximately $2.2 billion, subject to certain customary purchase price adjustments. On December 29, 2023 (the “Closing Date”), the Company completed the sale.

As of November 30, 2023, and August 31, 2023, the assets and liabilities of the Business were classified as held for sale and the carrying value is less than the estimated fair value less cost to sell and, thus, no adjustment to the carrying value of the disposal group is necessary. For the three months ended November 30, 2023, depreciation and amortization expense for long-lived assets are not recorded while these assets are classified as held for sale. The divestiture did not meet the criteria to be reported as discontinued operations and the Company continued to report the operating results for the Business in the Company’s Condensed Consolidated Statement of Operations in the DMS segment until the Closing Date.

Following is a summary of the carrying amounts of the major classes of assets and liabilities that were classified as held for sale (in millions):


	November 30, 2023		August 31, 2023
Assets held for sale:

Accounts receivable, net of allowance for credit losses	$	315	$	96

Inventories, net of reserve for excess and obsolete inventory	354		559
Prepaid expenses and other current assets	153		220
Property, plant and equipment, net of accumulated depreciation	812		724
Operating lease right-of-use asset	119		112
Goodwill	117		117

Deferred income taxes	86		96


Liabilities held for sale:

Accounts payable	$	992	$	876
Accrued expenses	304		364



Non-current operating lease liabilities	86		83