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Business Combinations | 9 Months Ended
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Dec. 31, 2020
Business Combinations [Abstract] |
Business Combination Disclosure [Text Block] | BUSINESS COMBINATION Acquisition of Silva International, Inc. On October 1, 2020 the Company acquired 100% of the capital stock of Silva International, Inc. (“Silva”), a natural, specialty dehydrated vegetable, fruit, and herb processing company serving global markets, for approximately $164 million in cash and $8.9 million of additional working capital on-hand at the date of acquisition. The acquisition of Silva diversifies the Company's product offerings and generates new opportunities for its plant-based ingredients platform. The Company continues to employ one of Silva's selling shareholders and as stipulated in the Silva purchase agreement has transferred $6 million to a third-party escrow account that may ultimately be earned by the selling shareholder upon completion of a post-combination service period. Since the compensation agreement for the selling shareholder who remains employed with the Company includes a post-combination service period, the Company has excluded the entire $6 million in the purchase price to be allocated. The $6 million in escrow is recognized as restricted cash in other noncurrent assets on the consolidated balance sheet at December 31, 2020. The contingent consideration arrangement for the selling shareholder includes a post-combination service requirement and forfeitable payment provisions, therefore under ASC Topic 805, "Business Combination s," must be treated as compensation expense and recognized ratably over the requisite service period in selling, general, and administrative expense on the consolidated statements of income. For the three and nine months ending December 31, 2020, the Company incurred $2.2 million and $3.9 million for acquisition-related transaction costs for the purchase of Silva, respectively. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income. The following preliminary allocation of the purchase price was based on third-party valuations and assumptions. At December 31, 2020, the Company is finalizing working capital acquired and income tax related assets and liabilities. The final purchase price allocation is expected to be completed in the fourth quarter of fiscal year 2021. The following table summarizes the preliminary purchase price allocation of the assets acquired and liabilities assumed on October 1, 2020.
(in thousands of dollars) |  |  |  |
Assets |  |  |  |
Cash and cash equivalents | $ | 8,126 |  |  |  |
Accounts receivable, net | 17,885 |  |  |  |
Advances to suppliers, net | 3,011 |  |  |  |
Inventory | 33,162 |  |  |  |
Other current assets | 833 |  |  |  |
Property, plant and equipment (net) | 24,437 |  |  |  |
Intangibles |  |  |  |
Customer relationships | 53,000 |  |  |  |
Trade names | 7,800 |  |  |  |
Goodwill | 53,728 |  |  |  |
Total assets acquired | 201,982 |  |  |  |
Liabilities |  |  |  |
Accounts payable and accrued expenses | 13,103 |  |  |  |
Accrued compensation | 3,350 |  |  |  |
Income taxes payable | 1,042 |  |  |  |
Deferred income taxes | 20,487 |  |  |  |
Total liabilities assumed | 37,982 |  |  |  |
Total assets acquired and liabilities assumed | $ | 164,000 |  |  |  |
A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of Silva. The goodwill recognized for the Silva acquisition is not deductible for U.S. income tax purposes. The tax basis of the assets acquired and liabilities assumed did not result in a step-up of tax basis. The Company determined the Silva operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented. Acquisition of FruitSmart, Inc. On January 1, 2020 the Company acquired 100% of the capital stock of FruitSmart, Inc. (“FruitSmart”), an independent specialty fruit and vegetable ingredient processor serving global markets, for approximately $80 million in cash, up to $25 million of contingent consideration payments, and $3.8 million of additional working capital on-hand at the date of acquisition. The contingent consideration is based on FruitSmart’s achievement of certain adjusted gross profit metrics in calendar years 2020 and 2021. The fair value of the contingent consideration, approximately $6.7 million, was recognized on the acquisition date and was measured using unobservable (Level 3) inputs. At June 30, 2020 the forecasted calendar year 2020 adjusted gross profit for FruitSmart was not expected to achieve the adjusted gross profit threshold required for a contingent consideration payment. Therefore, in the quarter ended June 30, 2020 the Company recorded $4.2 million in other operating income for the reversal of a portion of the contingent consideration liability. As of December 31, 2020, $2.5 million of contingent consideration liability related to the FruitSmart acquisition is included in other long-term liabilities on the consolidated balance sheet. The following final allocation of the purchase price was based on third-party valuations and assumptions. The following table summarizes the final purchase price allocation of the assets acquired and liabilities assumed on January 1, 2020.
(in thousands of dollars) |
Assets |
Cash and cash equivalents | $ | 1,298 |
Accounts receivable, net | 7,707 |
Inventory | 23,793 |
Other current assets | 310 |
Property, plant and equipment (net) | 23,400 |
Intangibles |
Customer relationships | 9,500 |
Developed technology | 4,800 |
Trade names | 3,300 |
Non-compete agreements | 1,000 |
Goodwill | 28,863 |
Total assets acquired | 103,971 |
Liabilities |
Accounts payable and accrued expenses | 7,592 |
Accrued compensation | 670 |
Deferred income taxes | 9,004 |
Total liabilities assumed | 17,266 |
Total assets acquired and liabilities assumed | $ | 86,705 |
A portion of the goodwill recorded as part of the acquisition was attributable to the assembled workforce of FruitSmart. The goodwill recognized for the FruitSmart acquisition is not deductible for U.S. income tax purposes. The tax basis of the assets acquired and liabilities assumed did not result in a step-up of tax basis. The Company determined the FruitSmart operations are not material to the Company’s consolidated results. Therefore, pro forma information is not presented. For the three and nine month ending December 31, 2019, the Company incurred $1.0 million and $1.9 million for acquisition-related transaction costs for the purchase of FruitSmart, respectively. The acquisition-related costs were expensed as incurred and recorded in selling, general, and administrative expense on the consolidated statements of income.

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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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- References No definition available. + Details
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