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Business Combinations | 3 Months Ended
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Nov. 27, 2021
Business Combination and Asset Acquisition [Abstract] |
Business Combinations | Business Combinations On August 31, 2021, we purchased 100% of the equity interests of Barletta Boat Company, LLC and Three Limes, LLC (collectively, "Barletta"), a manufacturer of high-quality, premium pontoon boats that are sold through a network of independent authorized dealers. The acquisition of Barletta resulted in a newly created Marine reportable segment that includes Barletta and Chris-Craft operating segments. We acquired Barletta for a purchase price of $286.3 million, including cash payments of $240.1 million, $25.0 million in common stock issued to the sellers (subject to a discount noted below), and contingent consideration from earnout provisions. The common stock fair value included in the purchase price reflects a 12% discount, due to the lack of marketability as these are unregistered shares that have a one-year lockup restriction, which reduced the value of the common stock to $22.0 million. The contingent consideration includes both a potential stock payout as well as a potential cash payment based on achievement of certain financial performance metrics over the next few years. The maximum payout under the earnout is $50.0 million in cash and $15.0 million in stock if all metrics are achieved. The fair value of the earnout at August 31, 2021 was $24.2 million. The fair value of the earnout as of November 27, 2021 was $30.6 million, of which $13.8 million is included in other current liabilities and $16.8 million is included in other long-term liabilities on the Consolidated Balance Sheets. The total purchase price was allocated to the acquired net tangible and intangible assets of Barletta, based on their preliminary fair values at the date of the acquisition. We expect to finalize the allocation of the purchase price when our valuation of the acquired intangible assets, goodwill, and tax accounts is complete. The following table summarizes the preliminary fair values assigned to the Barletta net assets acquired as of the date of acquisition:
(in thousands) | August 31, 2021
Cash | $ | 11,903 |
Other current assets | 24,564 |
Property, plant, and equipment | 17,250 |
Goodwill | 136,118 |
Other intangible assets | 111,400 |
Total assets acquired | 301,235 |
Accounts payable | 7,181 |
Product warranties | 4,656 |
Other current liabilities | 3,146 |
Total liabilities assumed | 14,983 |
Total purchase price | $ | 286,252 |
Goodwill from the Barletta acquisition is recognized in our newly created Marine segment. We expect that the full amount of goodwill will be deductible for tax purposes. The intangible assets acquired include a trade name, dealer network, and backlog. The trade name has an indefinite life, while the backlog and dealer network will be amortized on a straight line basis over 10 months and 12 years, respectively. Total transaction costs related to the Barletta acquisition were $3.1 million, of which $2.4 million were expensed during the first quarter of Fiscal 2022 and $0.7 million were expensed during the fourth quarter of Fiscal 2021. Transaction costs are included in selling, general and administrative expenses in the accompanying Consolidated Statements of Income and Comprehensive Income. Pro forma results of operations for this acquisition have not been presented as they were immaterial to the reported results.

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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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