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Business Combinations | 9 Months Ended
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Mar. 31, 2020
Business Combinations [Abstract] |
Business Combinations | (13) Business Combinations Nine months ended March 31, 2020 On January 31, 2020, we completed the acquisition of 100% of the membership interests in SnapWorx, LLC (“SnapWorx”), a software company providing patient contact management and workflow optimization for the sleep apnea resupply market. This acquisition has been accounted for as a business combination using purchase accounting and the results of SnapWorx are included in our consolidated financial statements from the acquisition date. This acquisition is not considered a material business combination and accordingly pro forma information is not provided. The acquisition was funded by drawing on our existing credit facility and through cash on-hand. We have not yet completed the purchase price allocation in relation to the SnapWorx acquisition. We do not believe that the completion of this work will materially modify the preliminary purchase price allocation. We expect to complete our purchase price allocation during the quarter ending June 30, 2020. The cost of the acquisition was allocated to the assets acquired and liabilities assumed based on estimates of their fair values at the date of acquisition. The goodwill recognized as part of the acquisition is reflected in the Software as a Service segment and is deductible for tax purposes. It mainly represents the synergies that are unique to our combined businesses and the potential for new products and services to be developed in the future. During the nine months ended March 31, 2020 we did no t record any material acquisition-related expenses. Fiscal year ended June 30, 2019 MatrixCare On November 13, 2018, we completed the acquisition of 100% of the shares in MatrixCare, Inc. and its subsidiaries (“MatrixCare”), a provider of software solutions for skilled nursing, life plan communities, senior living and private duty, for base purchase consideration paid of $750.0 million. This acquisition has been accounted for as a business combination using purchase accounting and included in our consolidated financial statements from November 13, 2018. The acquisition was paid for using borrowings under our revolving credit facility. We completed the purchase price allocation in relation to this acquisition during the quarter ended December 31, 2019. The cost of the acquisition was allocated to the assets acquired and liabilities assumed based on estimates of their fair values at the date of acquisition. The goodwill recognized as part of the acquisition is reflected in the Software as a Service segment and is not deductible for tax purposes. It mainly represents the synergies that are unique to our combined businesses and the potential for new products and services to be developed in the future. The fair values of assets acquired and liabilities assumed, and the estimated useful lives of intangible assets acquired are as follows (in thousands):
|  | Preliminary as of ‎June 30, 2019 |  | Adjustments |  | Final |  | Intangible ‎assets - ‎useful life
Current assets |  | $ | 50,325 |  | $ | - |  | $ | 50,325 |  |  |
Property, plant and equipment |  |  | 4,401 |  |  | - |  |  | 4,401 |  |  |
Trade names |  |  | 18,000 |  |  | - |  |  | 18,000 |  |  | 7 years
Developed technology |  |  | 133,000 |  |  | - |  |  | 133,000 |  |  | 7 years
Customer relationships |  |  | 114,000 |  |  | 2,000 |  |  | 116,000 |  |  | 15 years
Goodwill |  |  | 517,995 |  |  | 5,664 |  |  | 523,659 |  |  |
Assets acquired |  | $ | 837,721 |  | $ | 7,664 |  | $ | 845,385 |  |  |
Current liabilities |  |  | (13,751) |  |  | (255) |  |  | (14,006) |  |  |
Deferred revenue |  |  | (18,339) |  |  | (166) |  |  | (18,505) |  |  |
Deferred tax liabilities |  |  | (41,570) |  |  | (7,243) |  |  | (48,813) |  |  |
Debt assumed |  |  | (151,665) |  |  | - |  |  | (151,665) |  |  |
Total liabilities assumed |  | $ | (225,325) |  | $ | (7,664) |  | $ | (232,989) |  |  |
Net assets acquired |  | $ | 612,396 |  | $ | - |  | $ | 612,396 |  |  |
A reconciliation of the base consideration to the net consideration is as follows (in thousands):
Base consideration |  | $ | 750,000
Cash acquired |  |  | 15,873
Debt assumed |  |  | (151,665)
Net working capital and other adjustments |  |  | (1,812)
Net consideration |  | $ | 612,396
Other acquisitions During the year ended June 30, 2019, we also completed the following acquisitions: On July 6, 2018, we completed the acquisition of 100% of the shares in HEALTHCAREfirst Holding Company (“HEALTHCAREfirst”), a provider of software solutions and services for home health and hospice agencies, for a total purchase consideration of $126.3 million. On October 15, 2018, we completed the acquisition of 100% of the shares in HB Healthcare, a homecare provider in South Korea. On December 11, 2018, we completed the acquisition of assets in Interactive Health Network, a provider of integrated clinical and financial management software solution for long-term care companies. On December 13, 2018, we completed the acquisition of assets in Apacheta, a provider of cloud-based SaaS software that manages the medical equipment delivery process for home medical equipment dealers. On January 6, 2019, we completed the acquisition of Propeller Health, a digital therapeutics company providing connected health solutions for people living with chronic obstructive pulmonary disease and asthma, for a total purchase consideration of $242.9 million, which adjusts for cash acquired and debt assumed at the time of acquisition. We previously held a non-controlling interest in Propeller Health’s outstanding shares. As a result of the acquisition, we recognized a fair value gain of $1.9 million in other income during the year ended June 30, 2019 associated with the previous equity investment. These acquisitions have been accounted for as business combinations using purchase accounting and are included in our consolidated financial statements from the acquisition dates. These acquisitions, individually and collectively, are not considered a material business combination and accordingly pro forma information is not provided. The acquisitions were funded by drawing on our existing credit facility and through cash on-hand. We have completed the purchase price allocation in relation to all of these acquisitions. The cost of the share acquisitions was allocated to the assets acquired and liabilities assumed based on estimates of their fair values at the date of acquisition. The goodwill recognized as part of these acquisitions, which is predominantly not deductible for tax purposes, mainly represents the synergies that are unique to our combined businesses and the potential for new products and services to be developed in the future. Goodwill from these acquisitions has been reflected in the Software as a Service segment except for the goodwill resulting from the HB Healthcare and Propeller Health acquisitions, which have been recorded in the Sleep and Respiratory Care segment. The fair values of assets acquired and liabilities assumed of acquisitions during the year ended June 30, 2019, excluding MatrixCare, and the estimated useful lives of intangible assets acquired are as follows (in thousands):
|  | Final |  | Intangible ‎assets - ‎useful life
Current assets |  | $ | 31,648 |  |  |
Property, plant and equipment |  |  | 2,290 |  |  |
Deferred tax assets |  |  | 5,211 |  |  |
Trade names |  |  | 7,828 |  |  | 10 years
Non-compete |  |  | 1,000 |  |  | 3 years
Developed technology |  |  | 48,280 |  |  | 5 to 6 years
Customer relationships |  |  | 53,712 |  |  | 5 to 15 years
Goodwill |  |  | 287,469 |  |  |
Assets acquired |  | $ | 437,438 |  |  |
Current liabilities |  |  | (7,648) |  |  |
Deferred revenue |  |  | (3,619) |  |  |
Deferred tax liabilities |  |  | (2,367) |  |  |
Debt assumed |  |  | (35,104) |  |  |
Total liabilities assumed |  | $ | (48,738) |  |  |
Net assets acquired |  | $ | 388,700 |  |  |
During nine months ended March 31, 2019, we recorded acquisition-related expenses of $6.1 million.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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