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Acquisition | 6 Months Ended
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Jun. 30, 2022
Business Combination and Asset Acquisition [Abstract] |
Acquisition | Acquisition Powerline Plus Ltd On January 4, 2022, the Company acquired all issued and outstanding shares of capital stock of Powerline Plus Ltd. and its affiliate PLP Redimix Ltd. (collectively, the “Powerline Plus Companies"), a full-service electrical distribution construction company based in Toronto, Ontario. Consideration paid, funded through a combination of cash on hand and borrowings under the Facility (as defined below), was $110.6 million, net of cash acquired, and is subject to working capital and net asset adjustments. Additionally, the acquisition includes contingent earn-out consideration that may be payable if the Powerline Plus Companies achieve certain performance targets over a three-year post-acquisition period. As of the acquisition date, the fair value of the contingent earn-out consideration was $10.6 million. The future payout of the contingent earn-out consideration, if any, is unlimited and could be significantly higher than the acquisition date fair value. If the minimum thresholds of the performance targets are achieved the contingent earn-out consideration payment will be approximately $17.7 million. There were no changes in contingent earn-out consideration, subsequent to the acquisition, for the three and six months ended June 30, 2022. The results of the Powerline Plus Companies is included in the Company’s consolidated financial statements beginning on the transaction date. Approximately $0.2 million of acquisition-related costs associated with this acquisition were expensed by the Company during the three and six months ended June 30, 2022. The purchase agreement also includes contingent consideration provisions for down-side margin guarantee adjustments based upon certain contract performance subsequent to the acquisition. The contracts were valued at fair value at the acquisition date, causing no margin guarantee estimate or adjustments for fair value. Unfavorable changes in contract estimates, such as modified costs to complete or change order recognition, will result in changes to these margin guarantee estimates. Changes in margin guarantee adjustments on contracts, subsequent to the acquisition, were recorded in other income and were not significant for the three and six months ended June 30, 2022. Future margin guarantee adjustments, if any, are expected to be recognized through 2022 and possibly in early 2023. The following table summarizes the allocation of the opening balance sheet as of the date of the Powerline Plus Companies acquisition through June 30, 2022:
(in thousands) |  | (as of acquisition date) January 4, 2022 |  | Measurement Period Adjustments |  | Acquisition Allocation June 30, 2022
Cash paid |  | $ | 114,429 |  |  | $ | — |  |  | $ | 114,429 |
Contingent consideration - fair value at acquisition date |  | 10,608 |  |  | — |  |  | 10,608 |
Preliminary estimated net asset adjustments |  | 563 |  |  | (564) |  |  | (1) |
Total consideration, net of estimated net asset adjustments |  | 125,600 |  |  | (564) |  |  | 125,036 |
Less: Acquired cash |  | (3,853) |  |  | — |  |  | (3,853) |
Total consideration less cash acquired, net of estimated net asset adjustments |  | $ | 121,747 |  |  | $ | (564) |  |  | $ | 121,183 |
Cash and cash equivalents |  | $ | 3,853 |  |  | $ | — |  |  | $ | 3,853 |
Accounts receivable, net |  | 12,131 |  |  | (52) |  |  | 12,079 |
Contract assets, net |  | 12,443 |  |  | 148 |  |  | 12,591 |
Refundable income taxes |  | 394 |  |  | 280 |  |  | 674 |
Prepaid expenses and other current assets |  | 1,233 |  |  | (121) |  |  | 1,112 |
Property and equipment |  | 10,366 |  |  | — |  |  | 10,366 |
Operating lease right-of-use assets |  | 6,631 |  |  | — |  |  | 6,631 |
Accounts payable |  | (8,095) |  |  | (466) |  |  | (8,561) |
Contract liabilities |  | (1,597) |  |  | (95) |  |  | (1,692) |
Accrued income taxes |  | (686) |  |  | (37) |  |  | (723) |
Current portion of operating lease obligations |  | (1,224) |  |  | — |  |  | (1,224) |
Current portion of finance lease obligations |  | (1,492) |  |  | — |  |  | (1,492) |
Deferred income tax liabilities |  | (672) |  |  | (221) |  |  | (893) |
Operating lease obligations, net of current maturities |  | (4,897) |  |  | — |  |  | (4,897) |
Finance lease obligations, net of current maturities |  | (3,243) |  |  | — |  |  | (3,243) |
Net identifiable assets and liabilities |  | 25,145 |  |  | (564) |  |  | 24,581 |
Unallocated intangible assets |  | 56,650 |  |  | 791 |  |  | 57,441 |
Total acquired assets and liabilities |  | 81,795 |  |  | 227 |  |  | 82,022 |
Goodwill |  | $ | 43,805 |  |  | $ | (791) |  |  | $ | 43,014 |
The Company has developed preliminary estimates of fair value of the assets acquired and liabilities assumed for the purposes of allocating the purchase price. During the three months ended June 30, 2022, the Company recorded certain measurement period adjustments related to various working capital and deferred tax accounts determined during our purchase price allocation procedures. The goodwill to be recognized, which represents the excess of the purchase price over the net amount of the fair values assigned to assets acquired and liabilities assumed, is primarily attributable to the value of an assembled workforce and other non-identifiable assets. No synergies were anticipated in the acquisition as the Powerline Plus Companies will function as an individual business within the Company’s operating structure. Further adjustments are expected to the allocation as third party valuations of contingent earn-out consideration, acquired right-of-use assets and lease liabilities and identifiable intangible assets, including backlog, customer relationships, trade name and off-market component, are determined, and as net asset adjustments are finalized. Additionally, the Company is currently performing an analysis of the purchase price allocation and will make appropriate adjustments based on the analysis. A portion of the goodwill and identifiable intangible assets are expected to be tax deductible per applicable Canadian Revenue Authority regulations.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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