XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.24.1.u1

Business Combinations and Asset Acquisitions | 3 Months Ended
--- | ---
Mar. 31, 2024
Business Combination and Asset Acquisition [Abstract] |
Business Combination Disclosure | Acquisition of The Carlstar Group On February 29, 2024, the Company acquired 100% of the equity interests of The Carlstar Group, LLC ("Carlstar") for the following purchase consideration and subject to a working capital adjustment based on an agreed upon working capital target (amounts in thousands):
| Purchase Consideration
Titan International, Inc. common stock | $ | 168,693 |
Base cash consideration, net of cash acquired of $10,288 | 127,500 |
| 296,193 |
Additional cash consideration for excess net working capital acquired | 18,372 |
Other debt-like items | (3,665) |
Total purchase consideration, net of cash acquired | $ | 310,900 |
Carlstar is a global manufacturer and distributor of wheels and tires for a variety of end-market verticals including outdoor power equipment, power sports, trailers, and small to midsize agricultural and construction equipment. Carlstar has 17 manufacturing and distribution facilities located in four countries and provides solutions to customers in North America, Europe and China. The following table summarizes the major classes of assets and liabilities to which we have preliminarily allocated the purchase price consideration (amounts in thousands). The final allocation is subject to review and agreement with the prior equityholders of Carlstar.
| Fair Values as of February 29, 2024
Accounts receivable | $ | 98,439 |
Inventories | 145,988 |
Prepaid and other current assets | 13,339 |
Property, plant, and equipment | 128,162 |
Other long-term assets | 96,203 |
Goodwill | 12,867 |
Intangible assets | 15,770 |
Fair value of assets acquired | $ | 510,768 |
Accounts payable | 66,055 |
Other current liabilities | 26,377 |
Operating leases | 95,476 |
Deferred tax liabilities | 10,451 |
Other long-term liabilities | 1,509 |
Fair value of liabilities assumed | 199,868 |
Purchase Price | $ | 310,900 |
Goodwill represents value the Company expects to be created by combining the operations of the acquired business with the Company's operations, including the expansion of customer relationships, access to new customers, and potential cost savings and synergies. Goodwill related to the acquisition is expected to be deductible for tax purposes. The assignment of the acquired goodwill to the Company's reporting units has not been completed. The purchase consideration was allocated on a provisional basis to the estimated fair value of assets acquired and liabilities assumed for Carlstar as of February 29, 2024. These fair value estimates are preliminary and subject to change as management completes further analyses and studies. The following table summarizes the carrying amounts and weighted average lives of the acquired intangible assets (amounts in thousands):
| Carrying Value |  | Weighted Average Amortization (in Years)
Customer lists/relationships | $ | 10,347 |  |  | 10.00
Trade names | 3,508 |  |  | 15.00
Other intangibles | 1,915 |  |  | 6.25
Total | $ | 15,770 |  |  | 10.66
Through March 31, 2024, the actual revenue and net income of Carlstar since the acquisition date of February 29, 2024 included in the consolidated statement of operations is as shown below (amounts in thousands). The net income includes the effect of fair value adjustments for the amortization of inventory, intangible assets, and depreciation of property, plant and equipment.
| From Acquisition Date to March 31, 2024
Carlstar revenue | $ | 51,788 |
Carlstar net income | 1,254 |
The following is the unaudited pro forma financial information for the three months ended March 31, 2024 and 2023 that reflects our results of our operations as if the acquisition of Carlstar had been completed on January 1, 2023. This unaudited pro forma financial information is provided for informational purposes only and is not necessarily indicative of what the actual results of operations would have been had the transactions taken place on January 1, 2023, nor is it indicative of the future consolidated results of operations or financial position of the combined companies (amounts in thousands).
| March 31, 2024 |  | March 31, 2023
Proforma revenues | $ | 584,027 |  |  | $ | 725,775 |
Proforma net income | 25,445 |  |  | 23,056 |
Net income per common share, basic | $ | 0.35 |  |  | $ | 0.31 |
Net income per common share, diluted | $ | 0.35 |  |  | $ | 0.31 |
These pro forma amounts have been calculated after applying Titan's accounting policies and making certain adjustments, which primarily relate to: (i) severance-related costs, (ii) adjustments relating to the fair value step-ups to inventory, and (iii) transaction-related costs of both Titan and Carlstar. These pro forma amounts were adjusted to be excluded from the unaudited pro forma information for the three months ended March 31, 2024 and were adjusted to include these amounts for the three months ended March 31, 2023. Total acquisition-related costs for the three months ended March 31, 2024 were approximately $6.2 million.

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration