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Note 2. Acquisitions (Notes) | 12 Months Ended
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Jun. 30, 2020
Acquisitions [Abstract] |
Business Combination Disclosure | Acquisitions On October 1, 2018, the Company completed the acquisition of GES Holdings, Inc., Global Equipment Services and Manufacturing, Inc., and its subsidiaries (collectively referred to as “GES”). The acquisition included purchasing substantially all of the assets and assuming certain liabilities of GES Holdings, Inc., Global Equipment Services and Manufacturing, Inc., GES Infotek Pvt. Ltd., (India), GES Japan KK, Global Equipment Services and Manufacturing (Suzhou) Co., Ltd., (China), Suzhou Global Equipment Services and Trading Co., Ltd. (China), and acquiring 100% of the capital stock of Global Equipment Services & Manufacturing Vietnam Company Limited. This acquisition supported the Company’s strategy for growth and diversification into a multifaceted manufacturing solutions company. GES specializes in design, production, and servicing of automation, test, and inspection equipment for industrial applications in the semiconductor, electronics, and life sciences industries. Incremental costs expensed as incurred directly related to the acquisition has totaled $2.2 million, of which $0.8 million, $0.5 million, and $0.9 million were expensed during the fiscal years ended June 30, 2020, 2019, and 2018, respectively. These costs were recorded in Selling and Administrative Expenses on our Consolidated Statements of Income. The operating results of this acquisition are included in the Company’s consolidated financial statements beginning on the acquisition date of October 1, 2018. The acquisition was primarily funded with the Company’s primary credit facility. The GES acquisition was accounted for as a business combination. The Company recorded a net adjusted purchase price of $42.4 million which included a reduction for a net working capital adjustment of $7.6 million. The net working capital adjustment was disputed by the sellers, and in July 2020, it was determined, through the dispute resolution procedure provided for under the terms of the asset purchase agreement, the final net working capital adjustment to be $3.8 million. As a result, for fiscal year 2020, after the end of the twelve-month measurement period, the Company recorded a $3.8 million pre-tax charge in the Non-operating expense line on the Consolidated Statements of Income. The twelve-month measurement period ended on September 30, 2019. The following table summarizes the final purchase price allocation to assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess allocated to goodwill. Measurement period adjustments during the first quarter of fiscal year 2020 included a reduction of $2.0 million to Property and Equipment as a result of additional information obtained related to the valuation of certain equipment as of the acquisition date and a $0.2 million reduction in Other long-term liabilities to adjust deferred tax liabilities on the equipment. These measurement period adjustments to the purchase price allocation in the first quarter of fiscal year 2020 increased Goodwill by $1.8 million. For tax purposes, $8.9 million of the goodwill in the following table is expected to be deductible. See Note 1 – Business Description and Summary of Significant Accounting Policies and Note 6 - Goodwill and Other Intangible Assets of Notes to Consolidated Financial Statements for information on subsequent testing and measurement of Goodwill.
(Amounts in Thousands) | October 1, 2018
Cash | $ | 2,257 |
Receivables | 15,656 |
Inventories | 6,454 |
Prepaid expenses and other current assets | 1,424 |
Property and Equipment | 7,037 |
Other Intangible Assets | 19,259 |
Other Assets | 498 |
Goodwill | 13,745 |
Total assets acquired | $ | 66,330 |
Borrowings under Credit Facilities | $ | 12,843 |
Accounts payable | 4,113 |
Accrued expenses | 1,340 |
Other long-term liabilities | 5,653 |
Total liabilities assumed | $ | 23,949 |
Net assets acquired | $ | 42,381 |
Income tax liabilities, indirect tax liabilities, and liabilities for unrecognized tax benefits, including interest and penalties, of $4.2 million were recorded as of October 1, 2018 related to pre-closing tax periods of Global Equipment Services & Manufacturing Vietnam Company Limited of which $3.9 million was recorded in Other long-term liabilities and $0.3 million was included in Accrued expenses. This reflects management’s best assessment of the estimated taxes, interest, and penalties as of the acquisition date that are more likely than not to be paid, or for indirect taxes the probable amounts due to the tax authorities, including interest and penalties, under the applicable laws in the various jurisdictions. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is significantly different from our current estimate of the tax liabilities. Included in the Receivables line above is a related indemnification asset of $4.2 million for these estimated tax liabilities. The seller has agreed to indemnify the buyer in the purchase agreements for all taxes allocable to all pre-closing tax periods. Other Intangible Assets include the estimated fair values for finite-lived intangible assets acquired and are listed in the table below along with their estimated useful lives which are being amortized on a straight-line basis.
(Amounts in Thousands) | Estimated Fair Value |  | Estimated useful life (years)
Software | $ | 379 |  |  | 3 to 7
Technology | 5,060 |  |  | 5
Trade name | 6,369 |  |  | 10
Customer relationships | 7,451 |  |  | 15
Total other intangible assets | $ | 19,259 |  |  |

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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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