XML 50 R11.htm IDEA: XBRL DOCUMENT
v3.22.0.1

Business combinations | 12 Months Ended
--- | ---
Dec. 31, 2021
Business combinations |
Business combinations | 4. Business combinations SmartEquip acquisition On November 2, 2021, the Company acquired all of the issued and outstanding common shares of SmartEquip for a total cash purchase price of $173,743,000. SmartEquip is an innovative technology platform that supports customers' management of the equipment lifecycle and integrates parts procurement with both original equipment manufacturers and dealers. ​ The acquisition was accounted for in accordance with ASC 805, Business Combinations. The following table summarizes the preliminary allocation of the purchase price to the fair value of assets acquired and liabilities assumed. ​ SmartEquip purchase price allocation ​
​ | ​ | ​ | ​
Purchase price | ​ | $ | 173,743
​ | ​ |  |
Assets acquired: | ​ |  |
Cash and cash equivalents | ​ | $ | 2,039
Trade and other receivables | ​ |  | 2,926
Other current assets | ​ | ​ | 486
Property, plant and equipment | ​ |  | 120
Other non-current assets | ​ |  | 75
Deferred tax assets | ​ |  | 8,932
Intangible assets | ​ |  | 71,700
​ | ​ |  |
Liabilities assumed: | ​ |  |
Trade and other liabilities | ​ |  | 1,239
Deferred revenue | ​ | ​ | 3,565
Other non-current liabilities | ​ | ​ | 119
Deferred tax liabilities | ​ |  | 18,192
​ | ​ | ​ | ​
Fair value of identifiable net assets acquired | ​ |  | 63,163
Goodwill acquired on acquisition | ​ | $ | 110,580
​ The deferred tax assets are presented net of a $1,486,000 valuation allowance. ​ The following table summarizes the fair values of the identifiable intangible assets acquired: ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Fair value | ​ | Weighted average
Asset | ​ | at acquisition | ​ | amortization period
Customer relationships | ​ | $ | 50,700 | ​ | 4 - 15 years
Software and technology assets | ​ | ​ | 18,900 | ​ | 7 years
Trade names and trademarks | ​ | ​ | 1,000 | ​ | 3 years
Backlog | ​ | ​ | 1,100 | ​ | 2 years
Total | ​ | $ | 71,700 | ​ | 11.3 years
​ The amounts included in the SmartEquip provisional purchase price allocation are preliminary in nature and are subject to adjustment as additional information is obtained about the facts and circumstances that existed at the date of the acquisition. The final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the acquisition date. The purchase price will be finalized upon the determination of closing working capital. Adjustments to the preliminary values during the measurement period may impact the amounts recorded as assets and liabilities with a corresponding adjustment to goodwill and will be recognized in the period in which the adjustments are determined. 4. Business combinations (continued) SmartEquip acquisition (continued) ​ Goodwill ​ Goodwill has been assigned and allocated to “Other” for segmented information purposes and is based on an analysis of the fair value of net assets acquired. Goodwill relates to benefits expected from the acquisition of SmartEquip’s business, its assembled workforce and associated technical expertise, as well as anticipated synergies from applying the Company’s auction expertise and transactional capabilities to SmartEquip’s existing customer base. The transaction is considered a non-taxable business combination and the goodwill is not deductible for tax purposes. ​ Contributed revenue and net income ​ The results of SmartEquip’s operations are included in these consolidated financial statements from the date of acquisition. SmartEquip contributed revenue of $2,855,000 and net loss of $910,000 which includes $1,280,000 amortization of intangible assets for the period from November 2, 2021 to December 31, 2021. Pro forma results of operations have not been presented as such pro forma financial information would not be significantly different from historical results. ​ Transactions recognized separately from the acquisition of assets and assumptions of liabilities ​ At the date of acquisition, the Company issued 63,971 common shares to certain previous shareholders of SmartEquip in return for their continuing employment service. The common shares are expected to vest one third on each anniversary date of the acquisition over a three-year period as continuing employment services are provided to the Company. At the date of acquisition, the Company estimated that it will recognize a total fair value of $4,375,000 share-based continuing employment costs in acquisition-related costs over the vesting period, with an increase to additional paid-in capital, subject to continuing employment of those individuals. As and when the common shares vest, the Company will recognize the fair value of the issued common shares from additional paid-in capital to share capital. As part of the acquisition, the Company incurred $4,965,000 of acquisition-related costs for legal, advisory, integration and other professional fees, which included $439,000 of share-based continuing employment costs. These costs are included in the consolidated income statement for the period ended December 31, 2021 (Note 7). ​ 4. Business combinations (continued) Euro Auctions acquisition On August 9, 2021, the Company entered into a Sale and Purchase Agreement (“SPA”) pursuant to which it has agreed to purchase Euro Auctions Limited, William Keys & Sons Holdings Limited, Equipment & Plant Services Ltd, and Equipment Sales Ltd. (collectively, “Euro Auctions”), each being a private limited company incorporated in Northern Ireland (the “Euro Auctions Acquisition”). ​ Under the terms of the SPA, the Company will acquire all of the outstanding shares of Euro Auctions from their existing shareholders for approximately £775,000,000 (approximately $1.05 billion) cash consideration, to be paid on closing. The Euro Auctions acquisition is subject to regulatory clearances and the satisfaction of other customary closing conditions, including obtaining of antitrust clearance in the United Kingdom. Euro Auctions are providers of unreserved auction services in the commercial assets space with operations in the United Kingdom, Australia and the United States. ​ In connection with the execution of the SPA, the Company obtained a commitment from Goldman Sachs Bank USA and certain other financial institutions to provide funding through both bank and bridge facilities. On September 21, 2021, the Company amended its existing Credit Agreement (Note 21) and thereby cancelled the bank commitments and reduced the bridge commitment. On December 21, 2021, the Company completed its offering of two series of senior unsecured notes and thereby cancelled the remaining bridge commitment. ​ On December 23, 2021, the Company entered into two deal contingent foreign exchange forward currency contracts, with no upfront cash cost, to manage its exposure to foreign currency exchange rate fluctuations against the U.S. and Canadian dollar on £343,000,000 of the £775,000,000 purchase consideration for the proposed Euro Auctions Acquisition. The notional amounts of the derivative instruments are £216,000,000 (U.S dollar forward) and £127,000,000 (Canadian dollar forward) as of December 31, 2021. These forward contracts expire if the Euro Auctions Acquisition terminates or does not close by September 29, 2022. These forward contracts are accounted for as derivatives under ASC 815, Derivatives and Hedging, and are classified in other current assets and other current liabilities on the consolidated balance sheet, with changes in fair value recognized in the consolidated income statement. ​ 4. Business combinations (continued) Rouse acquisition On December 8, 2020, the Company acquired all of the issued and outstanding units of Rouse Services LLC (“Rouse”) for a total purchase price of $250,996,000. In the second quarter of 2021, the Company received a post-closing release from escrow of $728,000 related to the finalization of the net working capital adjustment, resulting in a decrease in total purchase price to $250,996,000 and a corresponding decrease in goodwill. Additionally, during the first and second quarter of 2021, the Company recorded adjustments to decrease the amount of liabilities assumed by $1,074,000, with a corresponding decrease in goodwill. The purchase price allocation was finalized on June 30, 2021. ​ The following table summarizes the fair value of consideration transferred at the date of acquisition, as well as the final purchase price allocation of the fair value of assets acquired and liabilities assumed. ​
​ | ​ | ​ | ​
​ |  | December 8, 2020
Total cash consideration paid | ​ | $ | 249,537
Equity consideration paid for pre-combination services | ​ |  | 1,459
Final purchase price | ​ | $ | 250,996
​ Rouse purchase price allocation
​ | ​ | ​ | ​
​ |  | December 8, 2020
Purchase price | ​ | $ | 250,996
​ | ​ |  |
Assets acquired: | ​ |  |
Cash and cash equivalents | ​ | $ | 226
Trade and other receivables | ​ |  | 4,601
Other current assets | ​ | ​ | 159
Property, plant and equipment | ​ |  | 1,171
Other non-current assets | ​ |  | 3,741
Deferred tax assets | ​ |  | 7,584
Intangible assets | ​ |  | 79,300
​ | ​ |  |
Liabilities assumed: | ​ |  |
Trade and other liabilities | ​ |  | 5,630
Other non-current liabilities | ​ | ​ | 3,188
Deferred tax liabilities | ​ |  | 936
​ | ​ | ​ | ​
Fair value of identifiable net assets acquired | ​ |  | 87,028
Goodwill acquired on acquisition | ​ | $ | 163,968
​ The following table summarizes the fair values of the identifiable intangible assets acquired: ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Fair value | ​ | Weighted average
Asset | ​ | at acquisition | ​ | amortization period
Customer relationships | ​ | $ | 71,000 | ​ | 15 years
Software and technology assets | ​ | ​ | 7,500 | ​ | 4 years
Trade names and trademarks | ​ | ​ | 800 | ​ | 2 years
Total | ​ | $ | 79,300 | ​ | 13.8 years
​ Goodwill relates to benefits expected from the acquisition of Rouse’s business, its assembled workforce and associated technical expertise, as well as anticipated synergies from the Company’s auction expertise and transactional capabilities to Rouse’s existing customer base. The transaction was considered a taxable business combination and all of the goodwill is deductible for tax purposes.

X
- 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
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types: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