Acquisitions

12 Months Ended

Sep. 27, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

ACQUISITIONS:

Union Supply Group, Inc.

On June 2, 2022, the Company completed the acquisition of Union Supply Group, Inc. ("Union Supply"), a commissary goods and services supplier, pursuant to the Stock Purchase Agreement ("Union Supply Purchase Agreement") dated as of April 8, 2022, by and among Aramark Correctional Services, LLC, a wholly owned subsidiary of the Company, and Tom Thomas, in

his capacity as the sellers' representative. Upon completion of the acquisition, Union Supply became a wholly owned subsidiary of the Company and its results are included in the Company's FSS United States segment. The cash consideration paid for Union Supply was $199.6 million. The Union Supply Purchase Agreement provided for contingent consideration, which the Company may be required to pay if Union Supply achieves certain adjusted EBITDA levels during calendar year 2023. A contingent consideration liability of $40.2 million was recorded as part of the acquisition with a separate amount that was accounted for as compensation expense recognized in earnings over the earnout period (see Note 17). The acquisition was financed utilizing funds from the Company's Receivables Facility.

Consideration

The Company accounted for the Union Supply acquisition as a business combination under the acquisition method of accounting. The Company finalized its allocation of the purchase price for the transaction based upon the fair value of net assets acquired and liabilities assumed at the date of acquisition.

Recognition and Measurement of Assets Acquired and Liabilities Assumed at Fair Value

The following table summarize the assets and liabilities assigned as of the acquisition date (in thousands):


Current assets	$	102,925
Noncurrent assets	208,181
Total assets	$	311,106

Current liabilities	$	24,308
Noncurrent liabilities	87,171
Total liabilities	$	111,479

Intangible Assets

The following table identifies the Company’s allocation of purchase price to the intangible assets acquired by category:


	Estimated Fair Value (in millions)		Weighted-Average Estimated Useful Life (in years)
Customer relationship assets	$	82.3	15
Trade name	43.0		15
Total intangible assets	$	125.3

The fair value of the customer relationship assets was determined using the “multi-period excess earnings method” which considers the present value of net cash flows expected to be generated by the customer relationships, excluding any cash flows related to contributory assets. The fair value of the trade name acquired was determined using the “relief-from-royalty method” which considers the discounted estimated royalty payments that are expected to be avoided as a result of the trademarks being owned.

Goodwill

The Company recorded $56.9 million of goodwill in connection with its purchase price allocation relating to the Union Supply acquisition, all of which was recognized in the FSS United States segment. Goodwill is calculated as the excess of consideration transferred over the net assets recognized and represents future economic benefits arising from other assets acquired that could not be individually identified and separately recognized, such as assembled workforce. Factors that contributed to the Company's recognition of goodwill include the Company's intent to complement its existing corrections business and expand its customer base. None of the goodwill recognized is expected to be deductible for income tax purposes.

Other Acquisitions

During fiscal 2024, fiscal 2023 and fiscal 2022, the Company paid net cash consideration of $148.7 million, $50.2 million and $123.2 million, respectively, for various acquisitions, excluding the purchase of Union Supply. The revenue, net income, assets and liabilities of the acquisitions did not have a material impact on the Company's consolidated financial statements.