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Acquisitions | 12 Months Ended
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Mar. 28, 2015
Acquisitions [Abstract] |
Acquisitions | NOTE 2 – ACQUISITIONS Monro’s acquisitions are strategic moves in our plan to fill in and expand our presence in our existing and contiguous markets, and leverage fixed operating costs such as distribution and advertising. Subsequent Events On April 25, 2015, we acquired the Car-X Brand, as well as the franchise rights for 146 auto service centers from Car-X Associates Corp., a subsidiary of Tuffy Associa tes Corp. The Car-X stores are owned and operated by 32 independent Car-X franchisees in Illinois, Indiana, Iowa, Kentucky, Minnesota, Missouri, Ohio, T ennessee, Texas and Wisconsin. The stores will continue to be operated under the Car-X name. The acquisition was financed through our existing credit facility. Fiscal 2015 During fiscal 2015, we acquired the following businesses for an aggregate purchase price of $87.9 million. The acquisitions were financed through our existing credit facility. The results of operations for these acquisitions are included in Monro’s financial results from the respective acquisition dates.
| · |  | On March 1, 2015, we acquired eight retail tire and automotive repair stores located in Florida from Martino Tire Stores. These stores operate under The Tire Choice name.
| · |  | On December 7, 2014, we acquired nine retail tire and automotive repair stores located in Florida from Gold Coast Tire & Auto Centers. These stores operate under The Tire Choice name.
| · |  | During July and December 2014 and March 2015, we acquired five retail tire and automotive repair stores located in New York, Georgia and New Jersey through five separate transactions. These stores operate under the Mr. Tire name.
| · |  | On September 28, 2014, we acquired nine retail tire and automotive repair stores located in Georgia from Wood & Fullerton Stores, LLC. These stores operate under the Mr. Tire name.
| · |  | On August 8, 2014, we acquired 35 retail tire and automotive repair stores located in Florida from Hennelly Tire & Auto, Inc. These stores operate under The Tire Choice name.
| · |  | On June 15, 2014, we acquired ten and nine retail tire and automotive repair stores located in Michigan from Lentz U.S.A. Service Centers, Inc. and Kan Rock Tire Company, Inc., respectively. Two of the acquired stores were never opened. These stores operate under the Monro Brake & Tire name.
| · |  | On April 13, 2014, we acquired two retail tire and automotive repair stores located in New Hampshire from Bald Tire & Auto, Inc. These stores were previously Tire Warehouse franchise locations and continue to operate under the Tire Warehouse name.
The acquisitions resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining these businesses with ours, and unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded finite-lived intangible assets at their estimated fair value related to customer relationships, trade name and favorable leases. We expensed all costs related to acquisitions during fiscal 2015. The total costs related to completed acquisitions were $1.1 million for the year ended March 28, 2015. These costs are included in the Consolidated Statements of Comprehensive Income primarily under operating, selling, general and administrative expenses. Sales and net income for the fiscal 2015 acquired entities totaled $52.2 million and approximately $.5 million, respectively, for the period from acquisition date through March 28, 2015. Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro. The preliminary fair values of identifiable assets acquired and liabilities assumed were based on preliminary valuation data and estimates. The excess of the net purchase price over the net tangible and intangible assets acquired was recorded as goodwill. Where the fair value of the net tangible and intangible assets exceeds the net purchase price, a gain was recorded. The preliminary allocation of the aggregate purchase price as of March 28, 2015 was as follows:
|  | As of Acquisition Date
|  | (Dollars in thousands)
Inventories |  | $ | 5,648
Other current assets |  |  | 567
Property, plant and equipment |  |  | 31,271
Intangible assets |  |  | 9,216
Deferred income tax assets |  |  | 15,354
Other non-current assets |  |  | 128
Total assets acquired |  |  | 62,184
Warranty reserves |  |  | 925
Other current liabilities |  |  | 2,837
Long-term capital leases and financing obligations |  |  | 47,803
Other long-term liabilities |  |  | 1,639
Total liabilities assumed |  |  | 53,204
Total net identifiable assets acquired |  | $ | 8,980
Total consideration transferred |  | $ | 87,910
Plus: gain on bargain purchase |  |  | 386
Less: total net identifiable assets acquired |  |  | 8,980
Goodwill |  | $ | 79,316
The following are the intangible assets acquired and their respective fair values and weighted average useful lives.
|  | As of Acquisition Date
|  |  |  |  | Weighted
|  | Dollars |  | Average
|  | in thousands |  | Useful Life
Customer lists |  | $ | 4,073 |  | 7 years
Trade name |  |  | 3,548 |  | 14 years
Favorable leases |  |  | 1,595 |  | 17 years
Total |  | $ | 9,216 |  | 11 years
We continue to refine the valuation data and estimates related to road hazard warranty, intangible assets, real estate and real property leases for the fiscal 2015 acquisitions and expect to complete the valuations no later than the first anniversary date of the respective acquisition. We anticipate that adjustments will continue to be made to the fair values of identifiable assets acquired and liabilities assumed and those adjustments may or may not be material. Fiscal 2014 During fiscal 2014, we acquired the following businesses for an aggregate purchase price of $27.5 million. The acquisitions were financed through our existing credit facility. The results of operations for these acquisitions are included in Monro’s financial results from the respective acquisition dates.
| · |  | On March 2, 2014, we acquired one retail tire and automotive repair store located in Kentucky from Hometown Tire Company, Inc. This store operates under the Ken Towery Tire and Auto Care name.
| · |  | On November 17, 2013, we acquired six retail tire and automotive repair stores located in Maryland and Delaware from Carl King Tire Co., Inc. These stores operate under the Mr. Tire name.
| · |  | On November 17, 2013, we acquired four retail tire and automotive repair stores located in Kentucky from S&S Firestone, Inc. These stores operate under the Ken Towery Tire and Auto Care name.
| · |  | On October 20, 2013, we acquired two retail tire and automotive repair stores located in North Carolina from XL Tire, Inc. These stores operate under the Tread Quarters name.
| · |  | On August 18, 2013, we acquired ten retail tire and automotive repair stores located in Virginia and Maryland from Curry’s Automotive Group. These stores operate under the Curry’s/Mr. Tire name.
| · |  | On August 11, 2013, we acquired one retail tire and automotive repair store located in New Jersey from Mitchell Tire Service. This store operates under the Mr. Tire name.
The acquisitions resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining these businesses with ours, and unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded finite-lived intangible assets at their fair value related to customer relationships, trade name, favorable leases and a non-compete agreement. We expensed all costs related to acquisitions during fiscal 2014. The total costs related to completed acquisitions were not material to the Consolidated Statements of Comprehensive Income. These costs are included in the Consolidated Statements of Comprehensive Income primarily under operating, selling, general and administrative expenses. Sales and net income for the fiscal 2014 acquired entities totaled $15.1 million and approximately $.1 million, respectively, for the period from acquisition date through March 29, 2014. Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro. We finalized the purchase accounting relative to the fiscal 2014 acquisitions during fiscal 2015. As a result of the final purchase price allocations, certain of the fair value amounts previously estimated were adjusted during the measurement period. These measurement period adjustments related to updated valuation reports and appraisals received from our external valuation specialists, as well as revisions to internal estimates. The changes in estimates recorded in fiscal 2015 include an increase in property, plant and equipment of $1.2 million; an increase in intangible assets of $.8 million; an increase in the long-term deferred income tax assets of $.6 million; an increase in the current portion of long-term debt, capital leases and financing obligations of $.1 million; an increase in long-term capital leases and financing obligations of $2.9 million; and a decrease in other liabilities of $.7 million. The measurement period adjustments resulted in a decrease to goodwill of $.3 million. We have recorded the identifiable assets acquired and liabilities assumed at their fair values as of their respective acquisition dates, with the remainder recorded as goodwill as follows:
|  | As of Acquisition Date
|  | (Dollars in thousands)
Inventories |  | $ | 1,513
Other current assets |  |  | 120
Property, plant and equipment |  |  | 9,786
Intangible assets |  |  | 2,069
Deferred income tax assets |  |  | 748
Other non-current assets |  |  | 94
Total assets acquired |  |  | 14,330
Warranty reserves |  |  | 176
Other current liabilities |  |  | 801
Long-term capital leases and financing obligations |  |  | 2,958
Other long-term liabilities |  |  | 369
Total liabilities assumed |  |  | 4,304
Total net identifiable assets acquired |  | $ | 10,026
Total consideration transferred |  | $ | 27,482
Plus: gain on bargain purchase |  |  | 217
Less: total net identifiable assets acquired |  |  | 10,026
Goodwill |  | $ | 17,673
The following are the intangible assets acquired and their respective fair values and weighted average useful lives.
|  | As of Acquisition Date
|  |  |  |  | Weighted
|  | Dollars |  | Average
|  | in thousands |  | Useful Life
Customer lists |  | $ | 776 |  | 7 years
Trade name |  |  | 500 |  | 7 years
Favorable leases |  |  | 778 |  | 10 years
Non-compete agreement |  |  | 15 |  | 3 years
Total |  | $ | 2,069 |  | 8 years

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References No definition available. + Details
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