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Acquisitions and Divestitures | 12 Months Ended
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Mar. 31, 2024
Business Combination and Asset Acquisition [Abstract] |
Acquisitions and Divestitures | Acquisition and Divestitures Acquisition On October 14, 2022, the Company completed the acquisition of EverWatch Corp. (“EverWatch”), a leading provider of advanced solutions to the defense and intelligence communities for approximately $445.1 million, net of post-closing adjustments and also incurred transaction costs as part of the acquisition. The acquisition was funded with cash on hand. As a result of the transaction, EverWatch became a wholly owned subsidiary of Booz Allen Hamilton Inc. The Company recognized $108.6 million of intangible assets which consists primarily of contract assets and were valued using the excess earnings method discounted cash flow approach, incorporating Level 3 inputs as described under the fair value hierarchy of Topic 820. These unobservable inputs reflect the Company's own judgment about which assumptions market participants would use in pricing an asset on a non-recurring basis. The intangible assets will be amortized over the estimated useful life of fourteen years. The goodwill of $330.9 million is primarily attributable to EverWatch's specialized workforce and the expected synergies between the Company and EverWatch, and is non-deductible for tax purposes. The following table summarizes the consideration and the allocation of the purchase price paid for EverWatch:
Cash consideration (gross of cash acquired) | $ | 445,074 |
Purchase price allocation: |
Cash | 4,779 |
Current assets | 27,725 |
Operating lease right-of-use asset | 7,894 |
Other long-term assets | 5,078 |
Intangible assets | 108,600 |
Deferred tax liabilities | (20,394) |
Current liabilities | (11,612) |
Operating lease liabilities - short-term | (1,362) |
Operating lease liabilities - long-term | (6,532) |
Total fair value of identifiable net assets acquired | $ | 114,176 |
Goodwill | $ | 330,898 |
The acquisition was accounted for under the acquisition method of accounting, which requires the total acquisition consideration to be allocated to the assets acquired and liabilities assumed based on an estimate of the acquisition date fair value, with the difference reflected in goodwill. During the first quarter of fiscal 2024, the Company completed the determination of fair values of the acquired assets and liabilities assumed. See note 6, “Goodwill and Intangible Assets,” for additional information. Pro forma results of operations for this acquisition are not presented because the acquisition is not material to the Company's consolidated results of operations. Divestitures Middle East and North Africa Management Consulting Business On September 1, 2022, the Company completed the divestiture of its management consulting business serving the Middle East and North Africa (“MENA”) region to Oliver Wyman, a global management consulting firm and a business of Marsh McLennan. The divestiture was substantially comprised of the contracts associated with the MENA business, the assets and liabilities associated with those contracts, and the workforce that provides services under those contracts. As a result of this transaction, the Company de-recognized the assets and liabilities associated with the MENA business and recognized a pre-tax gain of $31.2 million in the second quarter of fiscal 2023, which is reflected in other income, net, on the consolidated statement of operations. Managed Threat Services Business On December 5, 2022, the Company completed the divestiture of its commercial Managed Threat Services (“MTS”) business to Security On-Demand. The divestiture was substantially comprised of the contracts associated with the MTS business, the assets and liabilities associated with those contracts, and the workforce that provides services under those contracts. As a result of this transaction, the Company de-recognized the assets and liabilities associated with the MTS business and recognized a pre-tax gain of $4.6 million during the third quarter of fiscal 2023, which is reflected in other income, net, on the consolidated statement of operations. Business Deconsolidation In fiscal 2023, the Company forfeited certain participating rights of a consolidated artificial intelligence software platform business which has unrelated third-party interest holders and is classified as a variable interest entity (“VIE”). As a result of this transaction, the Company determined that it is not the primary beneficiary of the VIE and thus de-recognized the assets, liabilities and non-controlling interest of this business. The Company recorded the fair value of its retained equity investment of $7.6 million which was accounted for under the measurement alternative. The resulting pre-tax gain, calculated as the investment value less the net de-recognized balances, was $8.9 million and was reflected in other income, net, on the fiscal 2023 consolidated statement of operations. In the last quarter of fiscal 2024, it was determined that the investment was impaired and it was written off, with the resulting pre-tax loss of $7.6 million reflected in other income, net, on the fiscal 2024 consolidated statement of operations.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//205-20/tableOfContent + Details
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