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Business Combinations (Notes)
 9 Months Ended
Mar. 31, 2016
Business Combinations [Abstract]  
Business Combination Disclosure [Text Block]
Business Combinations

Acquisition of WIRmachenDRUCK GmbH

On February 1, 2016, we acquired 100% of the outstanding shares of WIRmachenDRUCK GmbH, a web-to-print business focused primarily on the German market. At closing, we paid €138,383 ($150,128 based on the exchange rate as of the date of acquisition) in cash and transferred €8,121 ($8,810 based on the exchange rate as of the date of acquisition) in ordinary shares of Cimpress N.V. We will pay an estimated €1,818 in cash ($1,972 based on the exchange rate as of the date of acquisition) during the fourth quarter of fiscal 2016 as a post-closing adjustment based on WIRmachenDRUCK's net cash and working capital position as of the acquisition date.

In addition, we agreed to a sliding scale earn-out of up to €40,000 ($43,395 based on the exchange rate as of the date of acquisition) based on the achievement of a cumulative gross margin target for calendar years 2016 and 2017 and is payable at our option in cash or ordinary shares. The estimated fair value of the earn-out as of the acquisition date is $9,872, based on a Monte Carlo Simulation valuation model. As a portion of the earn-out attributed to the two majority selling shareholders is contingent upon their post-acquisition employment, $8,687 is not included as part of the consideration but will be recognized as compensation expense through the required employment period of December 2017. The remaining earn-out of $1,185, not contingent upon post-acquisition employment is included as a component of purchase consideration. We will re-evaluate the fair value of the earn-out on a quarterly basis and recognize any change in estimate in general and administrative expense.

The acquisition supports our strategy to build a mass customization platform via focused brands and compliments similar previous investments in Europe. WIRmachenDRUCK brings internet-based capabilities that aggregate and route large numbers of small orders to a network of specialized production partners. Their outsourced supply chain model allows them to compete across a vast selection of product types, formats, sizes, finishing options and delivery choices.

Our consolidated financial statements include WIRmachenDRUCK from February 1, 2016, the date of acquisition. WIRmachenDRUCK's revenue included in our consolidated revenues for the quarter ended March 31, 2016 was $28,397. WIRmachenDRUCK's net income included in our consolidated net (loss) income attributable to Cimpress N.V. for the quarter ended March 31, 2016 was $1,560, inclusive of amortization of identifiable intangible assets but exclusive of earn-out related compensation expense and corporate level interest expense.

We have estimated the fair value of the contingent consideration and fair values of the identifiable intangible assets assumed as part of the acquisition. The amounts reported are considered provisional as we are completing the valuation work. The table below details the consideration transferred to acquire WIRmachenDRUCK:
Cash consideration
$
152,100

Cimpress N.V. shares transferred
8,810

Fair value of contingent consideration
1,185

Total consideration
$
162,095



The excess of the purchase price paid over the fair value of WIRmachenDRUCK's net assets was recorded as goodwill, which is primarily attributed to expected expansion of the customer base and value of the workforce of WIRmachenDRUCK. Goodwill is not expected to be deductible for tax purposes, and has been attributed to our Upload and Print business units reportable segment. The provisional fair value of the assets acquired and liabilities assumed was:
 
Amount
 
Weighted Average
Useful Life in Years
Tangible assets acquired and liabilities assumed
 
 
 
      Cash and cash equivalents
$
15,220

 
n/a
      Other current assets
5,231

 
n/a
      Other non-current assets
1,259

 
n/a
      Accounts payable and other current liabilities
(17,566
)
 
n/a
      Deferred tax liability
(27,337
)
 
n/a
Identifiable intangible assets:
 
 
 
      Customer relationships
24,952

 
7
      Trade name
24,952

 
15
      Print network
23,867

 
9
      Referral network
10,849

 
7
      Developed technology
8,679

 
3
Goodwill
91,989

 
n/a
Total purchase price
$
162,095

 
 


Other fiscal 2016 acquisitions
During the first quarter of fiscal 2016, we acquired two businesses that were not material to our results either individually or in the aggregate. Complementing our Upload and Print business units segment, we acquired all of the outstanding capital stock of Tradeprint Distribution Limited (formerly known as Fairprint Distribution Limited) and Litotipografia Alcione S.r.l. on July 31, 2015 and July 29, 2015, respectively. The aggregate consideration for these two acquisitions was $25,366, net of cash acquired. The consideration was allocated to the fair value of the assets acquired and liabilities assumed based on estimated fair values as of the respective acquisition dates. The aggregate allocation to goodwill, intangible assets, and net tangible assets was $9,390, $14,359 and $1,617, respectively.
Goodwill is calculated as the excess of the consideration over the fair value of the net assets, including intangible assets, and is primarily related to expected synergies from the transaction. The goodwill for the two acquisitions is not deductible for tax purposes, and has been attributed to our Upload and Print business units. The results of these acquisitions have been included in the consolidated financial statements from the date of purchase and are not material for the three and nine months ended March 31, 2016.
We utilized proceeds from our credit facility to finance our fiscal 2016 acquisitions. In connection with these acquisitions, we incurred transaction costs related to investment banking, legal, financial, and other professional services of approximately $844 and $1,289 during the three and nine months ended March 31, 2016, respectively. We have not presented pro forma results of the operations of the companies we acquired in fiscal 2016 because the effects of the acquired companies are not material to our consolidated financial statements.