ACQUISITIONS (Tables)

3 Months Ended

Oct. 27, 2018

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid, preliminary fair values of the Supervalu assets acquired and liabilities assumed, and the resulting preliminary goodwill. Due to the recent closing of the transaction, as of October 27, 2018, the purchase price allocation was preliminary and will be finalized when valuations are complete and final assessments of the fair value of other acquired assets and assumed liabilities are completed. There can be no assurance that such finalizations will not result in material changes from the preliminary purchase price allocations. The Company’s estimates and assumptions are subject to change during the measurement period (up to one year from the acquisition date), as the Company finalizes the valuations of certain tangible and intangible asset acquired and liabilities assumed.



(in thousands)	As of October 22, 2018
Cash and cash equivalents	$	25,102
Accounts receivable	557,680
Inventories	1,162,360
Prepaid expenses and other current assets	66,440
Current assets of discontinued operations⁽¹⁾	196,615
Property, plant and equipment	1,148,001
Goodwill	347,485
Intangible assets	1,077,541
Other assets	109,445
Long-term assets of discontinued operations⁽¹⁾	404,301
Accounts payable	(967,429		)
Other current liabilities	(282,692		)
Current portion of long term debt and capital lease obligations	(579,677		)
Current liabilities of discontinued operations⁽¹⁾	(150,611		)
Long-term debt and capital lease obligations	(179,262		)
Pension and other postretirement benefit obligations	(234,324		)
Deferred income taxes	(177,231		)
Other long-term liabilities assumed	(200,913		)
Long-term liabilities of discontinued operations⁽¹⁾	(1,401		)
Noncontrolling interests	1,633
Total fair value of net assets acquired	2,323,063
Less: cash and cash equivalents acquired⁽²⁾	(30,596		)
Less: unpaid consideration⁽³⁾	(18,638		)
Total consideration for acquisition, less cash acquired and unpaid consideration	$	2,273,829


(1)	Refer to Note 17. “Discontinued Operations” for additional Condensed Consolidated Balance Sheet information regarding the carrying value of discontinued operations at the end of the first quarter of fiscal 2019, subsequent to the acquisition date.


(2)	Includes cash and cash equivalents acquired attributable to discontinued operations.


(3)	Includes equity consideration for share-based awards that have not yet been paid, which reflects non-cash consideration for the first quarter of fiscal 2019 that will become cash consideration in subsequent periods.

Schedule of Finite-Lived Intangible Assets Acquired

The following table summarizes the identifiable intangible assets recorded based on provisional valuations. The identifiable intangible assets are expected to be amortized on a straight-line basis over the estimated useful lives indicated. The preliminary fair value of identifiable intangible assets acquired was determined using income approaches. Significant assumptions utilized in the income approach were based on Company-specific information and projections, which are not observable in the market and are thus considered Level 3 measurements as defined by authoritative guidance.



(in thousands)	Estimated Useful Life	As of October 22, 2018
Customer relationship assets⁽¹⁾	11–19 years	$	985,000
Favorable operating leases⁽¹⁾	3–25 years	24,455
Trade names⁽²⁾	2-9 years	98,000
Pharmacy prescription files⁽³⁾	5–7 years	59,700
Non-compete agreement⁽¹⁾	2 years	13,000
Unfavorable operating leases⁽¹⁾	2 years	(13,623		)
Total Supervalu finite-lived intangibles acquired		$	1,166,532

Schedule of Unaudited Pro Forma Information

The following table presents unaudited supplemental pro forma consolidated Net sales and Net income from continuing operations based on Supervalu’s historical reporting periods as if the acquisition had occurred as of July 30, 2017:



	13-Week Period Ended
(in thousands, except per share data)	October 27, 2018⁽¹⁾			October 28, 2017⁽²⁾
Net sales	$	5,983,208		$	5,910,484
Net loss from continuing operations	$	(54,716	)	$	(53,367	)
Basic net loss from continuing operations per share	$	(1.08	)	$	(1.05	)
Diluted net loss from continuing operations per share	$	(1.08	)	$	(1.05	)


(1)	These pro forma results reflect an additional 12 weeks from Supervalu for the period ended, September 8, 2018.


(2)	These pro forma results reflect Supervalu’s and Associated Grocers of Florida, Inc.’s, which was acquired by Supervalu on December 8, 2017, 13-week periods ended September 16, 2017 and August 5, 2017, respectively.