XML 29 R9.htm IDEA: XBRL DOCUMENT
v3.20.1

Acquisition - Erwin Hymer Group | 6 Months Ended
--- | ---
Jan. 31, 2020
Business Combinations [Abstract] |
Acquisition - Erwin Hymer Group | Acquisition – Erwin Hymer Group On February 1, 2019, the Company acquired Erwin Hymer Group SE ("EHG"). EHG is headquartered in Bad Waldsee, Germany, and is one of the largest RV manufacturers in Europe. EHG is managed as a stand-alone operating entity and is included in the European recreational vehicle segment. In the six months ended January 31, 2020, the Company made measurement period adjustments primarily related to the estimated fair value of certain fixed assets and deferred tax assets to better reflect the facts and circumstances that existed at the acquisition date. These adjustments resulted in a decrease in fixed assets, decreases in deferred tax assets and deferred tax liabilities, and a net increase of goodwill of $5,087. The impact to our Condensed Consolidated Statement of Income and Comprehensive Income as a result of these measurement period adjustments was immaterial. The following table summarizes the estimated fair values of the EHG assets acquired and liabilities assumed at the acquisition date. The Company is in the process of finalizing internal and third-party valuations of certain fixed assets and certain liabilities, therefore, the provisional estimates of fixed assets, goodwill, deferred income tax liabilities, income taxes payable and certain accrued liabilities are subject to change. The Company expects to finalize these values in the Company's fiscal quarter ending April 30, 2020.
Cash |  |  |  | $ | 97,887 |
Inventory |  |  |  | 593,053 |
Other assets |  |  |  | 426,096 |
Property, plant and equipment - rental vehicles |  |  |  | 80,132 |
Property, plant and equipment |  |  |  | 444,772 |
Amortizable intangible assets: |  |  |  |
Dealer network |  |  |  | 355,601 |
Trademarks |  |  |  | 126,181 |
Technology assets |  |  |  | 183,536 |
Backlog |  |  |  | 11,471 |
Goodwill |  |  |  | 1,013,559 |
Guarantee liabilities related to former EHG North American subsidiaries |  |  |  | (115,668) |
Other current liabilities |  |  |  | (850,623) |
Debt – Unsecured notes |  |  |  | (114,710) |
Debt – Other |  |  |  | (166,196) |
Deferred income tax liabilities |  |  |  | (155,047) |
Other long-term liabilities |  |  |  | (17,205) |
Non-controlling interests |  |  |  | (12,207) |
Total fair value of net assets acquired |  |  |  | 1,900,632 |
Less: cash acquired |  |  |  | (97,887) |
Total fair value of net assets acquired, less cash acquired |  |  |  | $ | 1,802,745 |
On the acquisition date, amortizable intangible assets had a weighted-average useful life of 17 years. The dealer network was valued based on the Discounted Cash Flow method and is amortized on an accelerated basis over 20 years. The trademarks and technology assets were valued on the Relief of Royalty method and are amortized on a straight-line basis over 20 years and 10 years, respectively. The backlog was valued based on the Discounted Cash Flow method and was amortized on a straight-line basis over a five-month period. We have recognized $1,013,559 of goodwill as a result of this transaction, of which approximately $242,000 will be deductible for tax purposes. The following unaudited pro forma information represents the Company’s results of operations as if the fiscal 2019 acquisition of EHG had occurred at the beginning of fiscal 2018. These performance results may not be indicative of the actual results that would have occurred under the ownership and management of the Company.
|  |  | Three Months Ended January 31, |  |  |  | Six Months Ended January 31,
|  |  | 2019 |  |  |  | 2019
Net sales |  |  | $ | 1,932,693 |  |  |  |  | $ | 4,259,961 |
Net (loss) |  |  | $ | (27,195) |  |  |  |  | $ | (4,734) |
Basic (loss) per common share |  |  | $ | (0.49) |  |  |  |  | $ | (0.08) |
Diluted (loss) per common share |  |  | $ | (0.49) |  |  |  |  | $ | (0.08) |
The supplemental pro forma earnings for the three and six-month periods ended January 31, 2019 were adjusted to exclude $42,059 and $99,148 of acquisition-related costs, respectively, as discussed below. Costs incurred during the three and six months ended January 31, 2019 related specifically to this acquisition totaling $42,059 and $99,148, respectively, are included in Acquisition-related costs in the Condensed Consolidated Statements of Income and Comprehensive Income. These costs included changes in the fair value of the foreign currency forward contract for the three and six-month periods ended January 31, 2019 of $31,152 and $73,707, respectively, discussed in Note 5 below, and $10,907 and $25,441, respectively, of other expenses, consisting primarily of legal, professional and advisory fees related to financial due diligence and preliminary implementation costs, rating agency fees related to obtaining financing commitments and regulatory review costs.

X
- 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration