Acquisitions

3 Months Ended

Mar. 31, 2020

(3)	Acquisitions

During the three months ended March 31, 2020, the Company purchased three newly constructed inland pressure barges for $20,100,000 in cash.

On January 3, 2020, the Company completed the acquisition of substantially all the assets of Convoy Servicing Company and Agility Fleet Services, LLC (collectively “Convoy”) for $40,322,000 in cash, reduced by a receivable due from Convoy of $3,142,000 recorded for post-closing adjustments that was settled in April 2020. Convoy is an authorized dealer for Thermo King refrigeration systems for trucks, railroad cars and other land transportation markets for North and East Texas and Colorado.

The fair values of the assets acquired and liabilities assumed from Convoy recorded at the acquisition date were as follows (in thousands):

Assets:
Accounts receivable	$	5,677
Inventories		11,771
Prepaid expenses		177
Property and equipment		415
Operating lease right-of-use assets		3,713
Goodwill		10,309
Other intangibles		17,170
Total assets		49,232
Liabilities:
Accounts payable and accrued liabilities		8,339
Current portion of operating lease liabilities		793
Other long-term liabilities		2,920
Total liabilities		12,052
Net assets acquired	$	37,180

The Company acquired intangible assets with a weighted average amortization period of 11 years, consisting of $9,000,000 for customer relationships with an amortization period of 10 years, $8,000,000 for distributorships with an amortization period of 12 years and $170,000 for non-compete agreements with an amortization period of three years.

Pro forma results of the acquisitions made in the 2020 first quarter have not been presented as the pro forma revenues and net earnings attributable to Kirby would not be materially different from the Company’s actual results.