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Acquisitions
 3 Months Ended
Aug. 31, 2025
Business Combination [Abstract]  
Acquisitions

Note M – Acquisitions

 

On June 18, 2025, we acquired Elgen, a leading provider of HVAC parts and components, ductwork, and structural framing used primarily in commercial building applications across North America. The purchase price was $91,185, net of cash acquired. Elgen operates as part of the Building Products operating segment and its results have been included in our consolidated statements of earnings since the date of acquisition. Pro forma results, including the acquired business since the beginning of fiscal 2024, would not be materially different from reported results.

 

The information included herein is based on the preliminary allocation of the purchase price using estimates of the fair value and useful lives of the assets acquired. The purchase price allocation is subject to further adjustment until all pertinent information regarding the assets acquired is fully evaluated by us, including but not limited to, the fair value accounting.

 

The assets acquired and liabilities assumed were recognized at their estimated acquisition-date fair values, with goodwill representing the excess of the purchase price over the fair value of the net identifiable assets acquired. The purchase price includes the fair values of other assets that were not identifiable, not separately recognizable under accounting rules (e.g., assembled workforce) or of immaterial value. The purchase price also includes strategic and synergistic benefits (i.e., investment value) specific to us, which resulted in a purchase price in excess of the fair value of the identifiable net assets. This additional investment value resulted in goodwill, which is not expected to be deductible for income tax purposes. During the three months ended August 31, 2025, we incurred approximately $1,700 of acquisition related expenses related to the transaction, which are recorded in restructuring and other expense, net in our consolidated statement of earnings.

 

In connection with the acquisition of Elgen, we identified and valued the following intangible assets:

 

 

 

 

 

 

 

 

 

 

Useful Life

Category

 

 

 

 

 

Amount

 

 

(Years)

Customer relationships

 

$

17,800

 

 

15

Trade name

 

 

7,900

 

 

10

Technological know-how

 

 

7,000

 

 

10

Non-compete agreement

 

 

 

 

 

 

1,700

 

 

5

Total acquired identifiable intangible assets

 

$

34,400

 

 

 

 

 

The following table summarizes the consideration paid and the final fair value assigned to the assets and liabilities assumed at the acquisition date.

 

 

 

 

 

 

 

 

 

Preliminary

 

 

 

 

 

 

 

 

 

Valuation

 

Cash and cash equivalents

 

 

 

 

$

1,093

 

Accounts receivable

 

 

 

 

 

12,751

 

Inventory

 

 

 

 

 

16,351

 

Other current assets

 

 

 

 

 

1,605

 

Property, plant and equipment

 

 

 

 

 

11,941

 

Operating lease assets

 

 

 

 

 

21,196

 

Intangible assets

 

 

 

 

 

34,400

 

Total identifiable assets

 

 

 

 

 

99,337

 

Accounts payable

 

 

 

 

 

(11,364

)

Current operating lease liability

 

 

 

 

 

(2,225

)

Accrued expenses

 

 

 

 

 

(4,465

)

Noncurrent operating lease liability

 

 

 

 

 

(19,041

)

Deferred income taxes

 

 

 

 

 

(3,582

)

Net identifiable assets

 

 

 

 

 

58,660

 

Goodwill

 

 

 

 

 

33,617

 

Total purchase price

 

 

 

 

$

92,277