v3.25.2
Acquisitions
 6 Months Ended
Jul. 04, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Acquisitions Acquisitions
Acquisition of Marzocchi Suspension S.r.l .
On December 19, 2024, the Company, through Marzocchi Suspension Holding S.r.l., acquired all of the outstanding equity of Marzocchi from VRM S.P.A. for $20,501, net of cash acquired. Marzocchi is a leader in motorcycle suspension manufacturing. The Company believes that this acquisition will be complementary to its powered vehicle businesses and will help to expand its product offerings. This transaction was accounted for as a business combination.
The purchase price of Marzocchi is preliminarily allocated to the assets acquired and liabilities assumed based on their estimated respective fair values as of December 19, 2024 with the excess purchase price allocated to goodwill. During the six months ended July 4, 2025, the Company recorded an increase of $135 to net assets and a decrease of the same amount to goodwill. The following table summarizes the provisional fair values of the identifiable assets acquired and liabilities assumed at the date of the acquisition, translated into U.S. dollars using the exchange rate on the same date:
Acquisition consideration
Cash consideration, net of cash acquired$20,501 
Total consideration at closing$20,501 
Fair market values
Accounts receivable$6,706 
Inventory12,097 
Prepaid and other current assets1,527 
Property, plant and equipment5,888 
Trademarks and brands1,500 
Customer and distributor relationships2,000 
Goodwill3,340 
Other assets5,650 
Total assets acquired$38,708 
Accounts payable$12,175 
Accrued expenses2,321 
Deferred Taxes840 
Other liabilities2,871 
Total liabilities assumed$18,207 
Purchase price allocation$20,501 

The gross contractual accounts receivable acquired in the acquisition was $6,706, all of which was expected to be collected. As of July 4, 2025, $6,038 of the acquired accounts receivable had been collected. This amount is translated using the exchange rate at the reporting date.
The amounts above represent the Company’s provisional fair value estimates related to the acquisition as of December 19, 2024, and are subject to subsequent adjustments as additional information is obtained during the applicable measurement period. The primary areas of estimates that are not yet finalized include certain tangible assets acquired and liabilities assumed, as well as the identifiable intangible assets. The Company incurred $1,765 of acquisition costs in conjunction with the Marzocchi acquisition, of which $289 were incurred during the six months ended July 4, 2025. These costs are classified as general and administrative expenses in the accompanying condensed consolidated statements of income.
The values assigned to the identifiable intangible assets were determined by discounting the estimated future cash flows associated with these assets to their present value. The goodwill of $3,340 reflects the strategic fit of Marzocchi with the Company’s operations. The weighted average amortization periods of the customer and distributor relationships and trade names and trademarks were 15 years. Goodwill is expected to have an indefinite life and will be subject to impairment testing. The goodwill is tax deductible for U.S. income tax purposes due to the step-up in tax basis of acquired goodwill and a portion is also deductible for Italian income tax purposes. In the acquisition of Marzocchi, the Company stepped up the intangibles by $3,500, which is not deductible for Italian income tax purposes.
The results of operations for Marzocchi have been included in the Company's consolidated statements of income since the closing date of the acquisition on December 19, 2024. The total revenues for Marzocchi for the three and six months ended July 4, 2025 amounted to $11,691 and $23,660, respectively. The total pre-tax losses for Marzocchi for the three and six months ended July 4, 2025 amounted to $722 and $2,345.