Business Combinations

9 Months Ended

Sep. 30, 2023

2. Business Combinations

During the first nine months of the year, we acquired certain assets and the operations of Noltex Holdings, Inc. and its affiliates (“Noltex”), Builder’s Millwork Supply (“BMS”), JB Millworks (“JBM”), Church’s Lumber (“Church’s”) and Frank’s Cash and Carry (“FCC”) for a combined total of $156.7 million. Noltex manufactures trusses and provides building components to single- and multi-family customers, serving Texas markets in the Dallas-Fort Worth, San Antonio, Houston, Lubbock, and Midland areas. BMS and JBM manufacture and supply millwork and trim in the Anchorage, Alaska and Chattanooga, Tennessee areas, respectively. Church’s and FCC provide lumber and other building supplies in the broader Detroit, Michigan area and the Florida Panhandle, respectively.

The acquisitions were funded with a combination of cash on hand and borrowings under our $1.8 billion revolving credit facility due January 17, 2028 (the “Revolving Facility”). The transactions were accounted for by the acquisition method, and accordingly the results of operations have been included in the Company’s consolidated financial statements from the acquisition dates. The purchase price was allocated to the assets acquired and liabilities assumed based on estimated fair values at the acquisition dates, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill.

The following table summarizes the aggregate fair values of the assets acquired and liabilities assumed for the acquisitions described above:


	Total
	(in thousands)
Accounts receivable	$	9,235
Inventories		24,154
Other current assets		70
Property, plant and equipment		11,744
Operating lease right-of-use assets		11,868
Finance lease right-of-use assets		528
Goodwill		64,280
Intangible assets		50,735
Other assets		126
Total assets	$	172,740

Accounts payable	$	727
Accrued liabilities		701
Contract liabilities		2,260
Operating lease liabilities		11,868
Finance lease liabilities		528
Total liabilities	$	16,084

Total purchase consideration		156,656
Less: accrued contingent consideration and purchase price adjustments		(13,750	)
Total cash consideration	$	142,906