XML 50 R36.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Acquisitions and Divestitures (Tables) | 12 Months Ended
--- | ---
May 31, 2018
Business Combinations [Abstract] |
Schedule of Aggregate Purchase Price for Businesses Acquired | The following summarizes the aggregate purchase price and fair value allocations for all businesses acquired:
(In thousands) | 2018 |  | 2017
Fair value of tangible assets acquired | $ | 421 |  |  | $ | 550,491 |
Fair value of service contracts acquired | 9,271 |  |  | 529,235 |
Fair value of other intangibles acquired | 892 |  |  | 17,556 |
Net goodwill recognized | 12,094 |  |  | 1,507,554 |
Total fair value of assets acquired | 22,678 |  |  | 2,604,836 |
Fair value of liabilities assumed | 3,332 |  |  | 502,465 |
Total cash paid for acquisitions, net of cash acquired | $ | 19,346 |  |  | $ | 2,102,371 |
The components of the final purchase price allocation, at fair value, are as follows:
Assets: | 2018
Accounts receivable | $ | 95,710 |
Inventories | 28,813 |
Uniforms and other rental items in service | 93,659 |
Income taxes, current | 15,873 |
Prepaid expenses and other current assets | 43,235 |
Property and equipment | 253,346 |
Goodwill | 1,545,905 |
Service contracts | 519,000 |
Trade names | 17,000 |
Other assets | 15,585 |
Liabilities: |
Accounts payable | (53,220 | )
Accrued compensation and related liabilities | (9,594 | )
Accrued liabilities | (108,198 | )
Long term accrued liabilities | (85,688 | )
G&K senior notes | (105,359 | )
Deferred income taxes | (187,649 | )
Total consideration | $ | 2,078,418 |
The net consideration transferred for G&K consisted of the following items:
(In thousands) |  |
Cash consideration for common stock | $ | 1,901,845 |  | (1)
Cash consideration for share-based awards | 62,257 |  | (2)
Cash consideration for G&K revolving debt | 124,180 |  | (3)
Cash consideration for transaction expenses | 24,529 |  | (4)
Total consideration | 2,112,811 |  |
Cash acquired | (34,393 | ) | (5)
Net consideration transferred | $ | 2,078,418 |  |
(1) The cash consideration for outstanding shares of G&K common stock is the product of the agreed-upon cash per share price of $97.50 and total G&K outstanding shares of approximately 19.5 million. (2) The cash consideration for share-based awards is the product of the agreed-upon cash per share price of $97.50 and the total number of restricted stock outstanding and the “in the money” stock options net of the weighted average exercise price. (3) The cash consideration for G&K revolving debt reflects the repayment of the outstanding obligation. (4) Represents G&K legal and professional fees that were incurred prior to acquisition and were due upon the closing of the transaction. (5) Represents the G&K cash balance acquired at acquisition.
Schedule of Preliminary Valuation and Amortization Period of Identifiable Intangible Assets | The table below sets forth the valuation and amortization period of identifiable intangible assets:
Identifiable intangible assets: | Valuation | Amortization Period
Service contracts | $ | 519,000 |  | 15 years
Trade names | 17,000 |  | 3 years
Total | $ | 536,000 |  |
Schedule of Pro Forma Financial Information | The following unaudited pro forma information presents the combined financial results for Cintas and G&K as if the G&K acquisition had been completed at the beginning of Cintas’ fiscal 2016, June 1, 2015. Prior to the acquisition, G&K used a 52-week or 53-week fiscal year ending on the Saturday nearest June 30. The pro forma financial information set forth below for the year ended May 31, 2016 includes G&K's annual results for the period of June 28, 2015 through July 2, 2016 adjusted for number of working days in Cintas' fiscal 2016. The pro forma financial information for the year ended May 31, 2017 includes G&K's publicly reported results for the period of July 2, 2016 through December 31, 2016 annualized and adjusted for the number of work days in the stub period of June 1, 2016 through March 21, 2017 and the actual results from March 22, 2017 through May 31, 2017. Actual net sales and net income of the acquired G&K business included in reported fiscal 2017 results were $187.7 million and $5.7 million, respectively.
In thousands except per share data | 2017 |  | 2016
Net sales | $ | 6,107,109 |  |  | $ | 5,762,741 |
Net income | $ | 488,482 |  |  | $ | 520,224 |
Earnings per common share - diluted | $ | 4.45 |  |  | $ | 4.66 |

X
- Definition Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2) -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(3) -URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463 + Details
Name: | us-gaap_BusinessAcquisitionProFormaInformationTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of finite-lived intangible assets acquired as part of a business combination or through an asset purchase, by major class and in total, including the value of the asset acquired, any significant residual value (the expected value of the asset at the end of its useful life) and the weighted-average amortization period. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 1 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=66006027&loc=d3e16265-109275 + Details
Name: | us-gaap_ScheduleOfFiniteLivedIntangibleAssetsAcquiredAsPartOfBusinessCombinationTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed. May include but not limited to the following: (a) acquired receivables; (b) contingencies recognized at the acquisition date; and (c) the fair value of noncontrolling interests in the acquiree. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=84161108&loc=d3e4845-128472 + Details
Name: | us-gaap_ScheduleOfRecognizedIdentifiedAssetsAcquiredAndLiabilitiesAssumedTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration