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Business Combinations | 12 Months Ended
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Mar. 31, 2024
Business Combination and Asset Acquisition [Abstract] |
Business Combinations | Business Combinations Greenspring Acquisition On September 20, 2021, the Company completed the acquisition of 100% of the equity of Greenspring Associates, Inc. and certain of its affiliates (collectively, “Greenspring”) in exchange for (i) cash consideration of approximately $185 million, net of an agreed upon adjustment based upon Greenspring’s net working capital balance at the closing date, (ii) 12,686,756 shares of Class A common stock and (iii) 3,071,519 newly issued Class C units of the Partnership (the “Greenspring acquisition”). The transaction agreement also provides for the payment of an earn-out of up to $75 million that is payable in 2025 subject to the achievement of certain management fee revenue targets for calendar year 2024. The results of Greenspring’s operations have been included in the consolidated financial statements effective September 20, 2021. The acquisition of Greenspring expanded the Company’s leadership in private markets solutions, providing added scale in venture capital and growth equity, and offering clients expanded access to the global innovation economy. The aggregate purchase price for the acquisition of Greenspring and the estimated fair values of the assets acquired and liabilities assumed at the acquisition date were as follows:
Acquisition date fair value of consideration transferred: |
Cash consideration | $ | 186,577 |
Class A common stock | 558,598 |
Class C units of the Partnership | 135,239 |
Contingent consideration | 17,769 |
Total purchase price | $ | 898,183 |
Estimated fair value of assets acquired and liabilities assumed: |
Cash and short-term receivables | $ | 5,725 |
Legacy Greenspring investments in funds and accrued carried interest allocations(1) | 1,203,299 |
Lease right-of-use assets, net | 2,585 |
Other assets and receivables | 2,146 |
Finite-lived intangible assets—contractual rights: management contracts | 310,944 |
Finite-lived intangible assets—client relationships | 96,650 |
Finite-lived intangible assets—contractual rights: service agreements | 9,537 |
Goodwill | 573,750 |
Deferred income taxes | (95,884) |
Accrued expenses and other liabilities | (4,685) |
Legacy Greenspring accrued carried interest-related compensation(1) | (1,045,157) |
Lease liabilities | (2,585) |
Non-controlling interests in legacy Greenspring entities(1) | (158,142) |
Total | $ | 898,183 |
_______________________________ (1)Represents investments in funds and carried interest allocations attributable to consolidated VIEs for which the Company did not acquire any direct economic interests. Such amounts are attributable to employees and therefore have been reflected as non-controlling interests in legacy Greenspring entities and legacy Greenspring accrued carried interest-related compensation, respectively. For the year ended March 31, 2022, the Company incurred $13.8 million of acquisition-related costs that were expensed as incurred and included in general, administrative and other expenses in the consolidated statements of income. The Company allocated $320.5 million and $96.7 million of the purchase price to the fair value of contractual rights and client relationships, respectively, which is being amortized over a weighted-average amortization period of 10.0 years. The $573.8 million of goodwill primarily related to Greenspring’s assembled workforce and business synergies expected to be realized from the transaction. This goodwill is not deductible for tax purposes. The amount of revenues and net income of Greenspring (including amounts attributable to legacy Greenspring entities) from the acquisition date of September 20, 2021 to March 31, 2022 were approximately $230 million and $54 million, respectively. The following supplemental unaudited pro forma information assumes the Greenspring acquisition, as well as the Reorganization and IPO, had been consummated as of April 1, 2020:
| Year Ended March 31,
| 2022 |  |
Revenues | $ | 1,866,986 |  |  |
Net income attributable to StepStone Group Inc. | 168,653 |  |  |
The Company’s fiscal year ends on March 31, and prior to the transaction, Greenspring’s fiscal year ended on December 31. To comply with SEC rules and regulations for companies with different fiscal year ends, the pro forma combined financial information has been prepared utilizing periods that differ by less than 93 days. The unaudited pro forma information for the year ended March 31, 2022 combines the Company’s historical audited consolidated statement of income for the year ended March 31, 2022 and Greenspring’s historical unaudited combined statement of income for the 12 months ended March 31, 2022. The supplemental unaudited pro forma information is based on estimates and assumptions believed reasonable and are not necessarily indicative of the Company’s consolidated results in future periods or the results that actually would have been realized had the Greenspring acquisition been completed to create a combined entity during the periods presented. The pro forma amounts have been calculated after reflecting the following adjustments that were directly attributable to the Reorganization, IPO, Greenspring acquisition and the related debt issuance used to fund a portion of the cash consideration, as if the transactions were consummated on April 1, 2020: Reorganization and IPO •adjustments to include compensation expense associated with the 2.5 million RSUs issued in connection with the IPO; •adjustments on interest expense to reflect the repayment of outstanding debt using a portion of the IPO proceeds; •adjustments to include federal and state income taxes for the Company’s share of taxable income generated by the Partnership; and •adjustments to reflect the pro-rata economic ownership attributable to the Company. Debt Financing •adjustments to include interest expense related to the Revolver used to fund a portion of the cash consideration. Greenspring Acquisition •adjustments to include the impact of additional amortization of acquired intangible assets that would have been charged; •adjustments to include the issuance of Class A common stock of the Company and Class C units of the Partnership as consideration for the transaction; •adjustments to reflect the pro-rata economic ownership attributable to the Company; •adjustments to reflect the tax effects of the Greenspring acquisition and including Greenspring in the Company’s results; and •adjustments to include acquisition-related transaction costs in earnings for the year ended March 31, 2021.

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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/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent + Details
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