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Note 3 - Acquisitions | 12 Months Ended
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Dec. 31, 2017
Notes to Financial Statements |
Business Combination Disclosure [Text Block] |
3. | Acquisitions
2017 acquisitions: The Company acquired controlling interests in ten businesses, seven operating in the Americas (Northern California & Nevada; Michigan; Minnesota; Washington, DC; Georgia; Ontario and Mexico), two operating in EMEA (United Kingdom; Denmark), and one operating in Asia Pacific (Australia). The Northern California & Nevada acquisition, which comprises lease brokerage and sales brokerage operations, was completed on January 3, 2017. The other nine acquisitions expand Colliers’ geographic presence in these markets in all three existing services lines. These acquisitions were accounted for by the acquisition method of accounting for business combinations and accordingly, the consolidated statements of earnings do not include any revenues or expenses related to these acquisitions prior to their closing dates. Details of these acquisitions are as follows:
|  | Northern California |  |  |  |  |  |  |
|  | & Nevada |  |  | Other |  |  | Aggregate |
|  | Acquisition |  |  | Acquisitions |  |  | Acquisitions |
Current assets, excluding cash |  | $ | 8,503 |  |  | $ | 5,420 |  |  | $ | 13,923 |
Non-current assets |  |  | 2,268 |  |  |  | 1,117 |  |  |  | 3,385 |
Current liabilities |  |  | (38,481 | ) |  |  | (10,463 | ) |  |  | (48,944 | )
Long-term liabilities |  |  | (10,600 | ) |  |  | (3,084 | ) |  |  | (13,684 | )
Redeemable non-controlling interest |  |  | - |  |  |  | (16,258 | ) |  |  | (16,258 | )
|  | $ | (38,310 | ) |  | $ | (23,268 | ) |  | $ | (61,578 | )
Cash consideration, net of cash acquired of $41,989 |  |  | (22,696 | ) |  |  | (35,978 | ) |  |  | (58,674 | )
Acquisition date fair value of contingent consideration |  |  | (10,412 | ) |  |  | (9,135 | ) |  |  | (19,547 | )
Total purchase consideration |  | $ | (33,108 | ) |  | $ | (45,113 | ) |  | $ | (78,221 | )
Acquired intangible assets |  | $ | 28,800 |  |  | $ | 32,428 |  |  | $ | 61,228 |
Goodwill |  | $ | 42,618 |  |  | $ | 35,953 |  |  | $ | 78,571 |
2016 acquisitions: The Company acquired controlling interests in ten businesses. Acquisitions included controlling interests in regional firms in the US, Canada, UK, Netherlands and France expanding Colliers’ geographic presence in these markets. Details of these acquisitions are as follows:
|  | Aggregate |
|  | Acquisitions |
Current assets, excluding cash |  | $ | 16,643 |
Non-current assets |  |  | 3,719 |
Current liabilities |  |  | (18,556 | )
Long-term liabilities |  |  | (4,207 | )
Non-controlling interests |  |  | (25 | )
|  | $ | (2,426 | )
Cash consideration, net of cash acquired of $10,067 |  |  | (82,073 | )
Acquisition date fair value of contingent consideration |  |  | (12,056 | )
Total purchase consideration |  | $ | (94,129 | )
Acquired intangible assets |  | $ | 43,602 |
Goodwill |  | $ | 52,954 |
Acquisition-related transaction costs for the year ended December 31, 2017 totaled $6,247 ( 2016 - $2,794 ) and were recorded as expense under the caption “acquisition-related items”. In all years presented, the fair values of non-controlling interests were determined using an income approach with reference to a discounted cash flow model using the same assumptions implied in determining the purchase consideration. The purchase price allocations of acquisitions resulted in the recognition of goodwill. The primary factors contributing to goodwill are assembled workforces, synergies with existing operations and future growth prospects. For acquisitions completed during the year ended December 31, 2017, goodwill in the amount of $17,531 is deductible for income tax purposes ( 2016 - $18,837 ). The Company typically structures its business acquisitions to include contingent consideration. Certain vendors, at the time of acquisition, are entitled to receive a contingent consideration payment if the acquired businesses achieve specified earnings levels during the one - to five -year periods following the dates of acquisition. The ultimate amount of payment is determined based on a formula, the key inputs to which are (i) a contractually agreed maximum payment; (ii) a contractually specified earnings level and (iii) the actual earnings for the contingency period. If the acquired business does not achieve the specified earnings level, the maximum payment is reduced for any shortfall, potentially to nil. Unless it contains an element of compensation, under purchase accounting contingent consideration is recorded at fair value each reporting period. The fair value recorded on the consolidated balance sheet as at December 31, 2017 was $50,300 (see note 19 ). Contingent consideration with a compensatory element is recognized on a straight-line basis over the term of the contingent consideration arrangement. The liability recorded on the balance sheet for the compensatory element of contingent consideration arrangements as at December 31, 2017 was $8,320. The estimated range of outcomes (undiscounted) for these contingent consideration arrangements is determined based on the formula price and the likelihood of achieving specified earnings levels over the contingency period, and ranges from $77,745 to a maximum of $91,464. These contingencies will expire during the period extending to January 2022. During the year ended December 31, 2017, $11,187 was paid with reference to such contingent consideration ( 2016 - $2,018 ). The consideration for the acquisitions during the year ended December 31, 2017 was financed from borrowings on the Company’s revolving credit facility and cash on hand. The amounts of revenues and earnings contributed from the dates of acquisition and included in the Company’s consolidated results for the year ended December 31, 2017, and the supplemental pro forma revenues and earnings of the combined entity had the acquisition dates been January 1, 2016, are as follows:
|  |  | Revenues |  |  |  | Net earnings |
Actual from acquired entities for 2017 |  | $ | 215,174 |  |  | $ | 7,377 |
Supplemental pro forma for 2017 (unaudited) |  |  | 2,299,891 |  |  |  | 93,145 |
Supplemental pro forma for 2016 (unaudited) |  |  | 2,150,685 |  |  |  | 100,105 |
Supplemental pro forma results were adjusted for non-recurring items.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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