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Acquisitions | 6 Months Ended
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Jun. 30, 2021
Acquisitions |
Acquisitions | 6. Acquisition: Acquisition of Interwork Technologies On April 30, 2020, the Company completed the purchase of Interwork Technologies Inc., a Delaware corporation and Interwork Technologies Inc., a corporation incorporated under the laws of the Province of Ontario, Canada (collectively, “Interwork”) for an aggregate purchase price of $5 million Canadian dollar (equivalent to $3.6 million USD), subject to certain working capital adjustments, paid at closing plus a potential post-closing $1.1 million Canadian dollars (equivalent to $0.8 million USD) earn-out. The purchase price allocation is final. The purchase consideration included approximately $0.8 million of potential earn-out consideration if certain targets are achieved, payable in cash. As of June 30, 2021, the Company reassessed the earn-out liability and increased the fair value of the earn-out liability to approximately $0.9 million, with less than $0.1 million adjustment recognized within selling, general and administrative expenses during the six months ended June 30, 2021. The earn-out liability is included in accounts payable and accrued expenses as of June 30, 2021 as payment would be due in the third quarter of 2021. There were no acquisition related costs incurred during the three and six months ended June 30, 2021. The Company incurred acquisition related costs of approximately $0.2 million and $0.6 million during the three and six months ended June, 2020, respectively, in conjunction with the acquisition of Interwork, which are reflected in the accompanying consolidated statements of earnings. Acquisition of CDF Group Limited On November 6, 2020, the Company entered into a Share Purchase Agreement and purchased the entire share capital of CDF Group Limited (“CDF”) for an aggregate purchase price of approximately £13.3 million (equivalent to approximately $17.4 million USD), subject to certain working capital and other adjustments. The allocation of the purchase price was based upon the estimated fair value of CDF’s net tangible and identifiable intangible assets as of the date of the acquisition. The transaction was accounted for under the purchase method of accounting. The financial position and operating results of CDF are included in the Company’s consolidated financial statements for the three and six months ended June 30, 2021. The Company recorded net revenue for CDF of approximately $6.9 million and net income of approximately $0.3 million during the three months ended June 30, 2021. The Company recorded net revenue for CDF of approximately $15.3 million and net income of approximately $0.7 million during the six months ended June 30, 2021. The impact of the CDF acquisition’s preliminary purchase price allocations on the Company’s consolidated balance sheet and the acquisition date fair value of the total consideration transferred is depicted in the table below. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final valuation of goodwill and intangible assets, (ii) capitalized software, and (iii) the final evaluation and assessment of income tax accounts; therefore the final fair value of the assets acquired and liabilities assumed may vary from the Company’s preliminary estimates: ​
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(in thousands) | ​ | ​ | ​
Cash | ​ | $ | 8,463
Trade accounts receivable | ​ | ​ | 8,093
Other current assets | ​ | ​ | 260
Equipment and leasehold improvements, net | ​ | ​ | 1,367
Intangible assets | ​ | ​ | ​
Customer relationships (13-year useful life) | ​ | ​ | 6,357
Trademarks (15-year useful life) | ​ | ​ | 504
Non-compete (1-year useful life) | ​ | ​ | 42
Goodwill | ​ | ​ | 12,774
Other assets | ​ | ​ | 375
Accounts payable and other current liabilities | ​ | ​ | (12,364)
Deferred income tax liabilities | ​ | ​ | (1,461)
Other liabilities | ​ | ​ | (306)
Net assets | ​ | $ | 24,104
​
​ | ​ | ​ | ​
(in thousands) | ​ | ​ | ​
Supplementary information: | ​ | ​ | ​
Cash paid to sellers | ​ | $ | 24,104
Cash acquired in acquisition | ​ | ​ | (8,463)
Net cash paid for acquisition | ​ | $ | 15,641
​ Estimated intangible assets are comprised of approximately $6.4 million of customer relationships with an amortization period of 13 years and $0.5 million of tradenames with an amortization period of 15 years, representing the expected periods of benefits. Goodwill is the excess of the consideration transferred over the net assets recognized and represents the expected revenue and cost synergies of the combined company and assembled workforce. Goodwill recognized as a result of the acquisition is not deductible for income tax purposes. The preliminary allocation of the purchase price for the acquisition of CDF was allocated based on information that is currently available. The Company’s estimates and assumptions underlying the initial allocations is subject to the collection of information necessary to complete its allocations within the measurement period, which is up to one year from the acquisition date.

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