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Intangible Assets
9 Months Ended
Sep. 30, 2021
Goodwill And Intangible Assets Disclosure [Abstract]  
Intangible Assets

7. Intangible Assets

The following table presents intangible assets (in thousands) as of:

 

 

 

September 30, 2021

 

 

December 31, 2020

 

 

 

Gross

Carrying

Amount

 

 

Accumulated Amortization

 

 

Gross

Carrying

Amount

 

 

Accumulated Amortization

 

Customer relationships

 

$

1,709,115

 

 

$

(266,507

)

 

$

195,435

 

 

$

(94,690

)

Trade names

 

 

201,861

 

 

 

(125,375

)

 

 

52,061

 

 

 

(38,138

)

Subcontractor relationships

 

 

5,440

 

 

 

(2,360

)

 

 

5,440

 

 

 

(1,944

)

Non-compete agreements

 

 

13,519

 

 

 

(2,586

)

 

 

3,719

 

 

 

(2,001

)

Developed technology

 

 

97,200

 

 

 

(944

)

 

 

-

 

 

 

-

 

Total intangible assets

 

$

2,027,135

 

 

$

(397,772

)

 

$

256,655

 

 

$

(136,773

)

 

In connection with the BMC Merger and current year acquisitions, we recorded intangible assets of $1.8 billion, which includes $1.5 billion of customer relationships, $149.8 million of trade names, $97.2 million of developed technology, and $9.8 million of non-compete agreements. The weighted average useful lives of the acquired intangible assets are 11.1 years in total, 11.3 years for customer relationships, 7.0 years for trade names, 9.0 years for developed technology and 5.7 years for non-compete agreements. The fair value of acquired customer relationship intangible assets was primarily estimated by applying the multi-period excess earnings method, which involved the use of significant estimates and assumptions primarily related to forecasted revenue growth rates, gross margin, contributory asset charges, customer attrition rates, and market-participant discount rates. These measures are based on significant Level 3 inputs not observable in the market. Key assumptions developed based on the Company’s historical experience, future projections and comparable market data include future cash flows, long-term growth rates, attrition rates and discount rates.

 

In connection with the Gypsum Divestiture, we derecognized $0.5 million of intangible assets, net. Refer to Note 2 – Business Combinations and Dispositions for additional information.

 

During the three and nine months ended September 30, 2021, we recorded amortization expense in relation to the above-listed intangible assets of $92.3 million and $261.6 million, respectively. During the three and nine months ended September 30, 2020, we recorded amortization expense in relation to the above-listed intangible assets of $5.4 million and $16.7 million, respectively.

 

The following table presents the estimated amortization expense for intangible assets for the years ending December 31 (in thousands):

 

2021 (from October 1, 2021)

 

$

96,494

 

2022

 

 

248,732

 

2023

 

 

217,259

 

2024

 

 

187,624

 

2025

 

 

165,262

 

Thereafter

 

 

713,992

 

Total future net intangible amortization expense

 

$

1,629,363