XML 18 R7.htm IDEA: XBRL DOCUMENT v3.4.0.3
Note 2 - Acquisitions
 3 Months Ended
Mar. 31, 2016
Notes to Financial Statements  
Business Combination Disclosure [Text Block]
2. Acquisitions
 
Acquisition of Pramac
 
On March 1, 2016, a subsidiary of the Company acquired a 65% ownership interest in Pramac for a purchase price, net of cash acquired, of $61,280. Headquartered in Siena, Italy, Pramac is a leading global manufacturer of stationary, mobile and portable generators primarily sold under the Pramac® brand. Pramac products are sold in over 150 countries through a broad distribution network. The acquisition purchase price was funded solely through cash on hand. The 35% noncontrolling interest in Pramac had an acquisition date fair value of $34,253, and was recorded as a redeemable noncontrolling interest in the March 31, 2016 condensed consolidated balance sheet, as the noncontrolling interest party has within its control the right to require the Company to redeem its interest in Pramac.
 
 
 
The Company recorded a preliminary purchase price allocation during the first quarter of 2016 based upon its estimates of the fair value of the acquired assets and assumed liabilities. The preliminary purchase price allocation was as follows:
 
 
 
March 1, 2016
 
         
Accounts receivable, net
   $ 56,756  
Inventories
     38,902  
Property and equipment, net
     11,425  
Intangible assets
     35,884  
Goodwill
     53,724  
Other assets
     4,829  
Total assets acquired
     201,520  
         
Short-term borrowings
     21,104  
Accounts payable
     46,392  
Long-term debt and capital lease obligations (including current portion)
     19,244  
Other liabilities
     19,194  
Redeemable noncontrolling interest
     34,253  
Noncontrolling interest
     53  
Net assets acquired
   $ 61,280  
 
The goodwill ascribed to this acquisition is not deductible for tax purposes. The accompanying condensed consolidated financial statements include the results of Pramac from the date of acquisition through March 31, 2016.
 
Acquisition of CHP
 
On August 1, 2015, a subsidiary of the Company acquired CHP for a purchase price, net of cash acquired, of $74,570. Headquartered in Vergennes, Vermont, CHP is a leading manufacturer of high-quality, innovative, professional-grade engine powered equipment used in a wide variety of property maintenance applications, with sales primarily in North America. The acquisition purchase price was funded solely through cash on hand.
 
The Company recorded a preliminary purchase price allocation during the third quarter of 2015 based upon its estimates of the fair value of the acquired assets and assumed liabilities. As a result, the Company recorded approximately $81,726 of intangible assets, including approximately $30,076 of goodwill, as of the acquisition date. The purchase price allocation was finalized in the fourth quarter of 2015, resulting in a $6,552 decrease to total intangible assets, including an increase of $6,208 in goodwill. The goodwill ascribed to this acquisition is not deductible for tax purposes. In addition, the Company assumed $12,000 of CHP’s debt in conjunction with this acquisition. The accompanying condensed consolidated financial statements include the results of CHP from the date of acquisition through March 31, 2016.
 
The following unaudited pro forma information of the Company gives effect to these acquisitions as though the transactions had occurred on January 1, 2015. Consolidated net sales on a pro forma basis for the three month periods ended March 31, 2016 and 2015 were $315,882 and $374,511, respectively. The pro forma impact of these acquisitions on net income and earnings per share is not significant due to amortization related to acquired intangible assets and the fair value step-up of inventory in purchase accounting. This unaudited pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actuallywould have been achieved had the acquisitions been consummated  on January 1, 2015.