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Acquisitions | 12 Months Ended
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Mar. 27, 2021
Acquisitions [Abstract] |
Acquisitions | Note 3 – Acquisitions Monro’s acquisitions are strategic moves in our plan to fill in and expand our presence in our existing and contiguous markets, expand into new markets and leverage fixed operating costs such as distribution, advertising and administration. Acquisitions in this footnote include acquisitions of five or more locations as well as acquisitions of one to four locations that are part of our greenfield store growth strategy. Subsequent Event On April 25, 2021, we acquired 30 retail tire and automotive repair stores located in California from Mountain View Tire & Service, Inc. These stores will operate under the Mountain View Tire & Service name. The acquisition was financed through our Credit Facility. 2021 On December 6, 2020, we acquired 17 retail tire and automotive repair stores located in California from Fred Allen Enterprises, Inc. for $17.1 million. These stores will operate under the Tire Choice name. The acquisition was financed through our Credit Facility. The results of operation for the acquisition are included in our financial results from the acquisition date. Prior to this acquisition, our acquisition activity was paused due to the impact of the COVID-19 pandemic. The acquisition resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining the business with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded a customer list intangible asset with a useful life of seven years at its estimated fair value of approximately $0.4 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease. We expensed all costs related to the acquisition during 2021. The total costs related to the completed acquisition were $0.3 million and these costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expenses. Sales and net income related to the completed acquisition totaled $5.8 million and $0.1 million, respectively for the period from acquisition date through March 27, 2021. The net income of $0.1 million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and income taxes. 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 entity was not owned by Monro. We accounted for the acquisition as a business combination using the acquisition method of accounting in accordance with the FASB ASC Topic 805, “Business Combinations.” The acquired assets and liabilities assumed were recorded at their acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The acquisition-date fair values were assigned based on preliminary valuations and estimates, and the consideration transferred and net liabilities assumed were recorded as goodwill.
2021 Acquisition-date Fair Values Assigned |  |  |
(thousands) |  |  |
Inventory |  | $ | 1,046
Other current assets |  |  | 172
Property and equipment |  |  | 674
Finance lease and financing obligation assets, net |  |  | 5,089
Operating lease assets, net |  |  | 8,980
Intangible asset |  |  | 418
Other non-current assets |  |  | 30
Long-term deferred income tax assets |  |  | 1,331
Total assets acquired |  |  | 17,740
Current portion of finance leases and financing obligations |  |  | 748
Current portion of operating lease liabilities |  |  | 976
Deferred revenue |  |  | 697
Other current liabilities |  |  | 4
Long-term finance leases and financing obligations |  |  | 7,911
Long-term operating lease liabilities |  |  | 7,433
Other long-term liabilities |  |  | 536
Total liabilities assumed |  |  | 18,305
Total net identifiable liabilities assumed |  | $ | (565)
Total consideration transferred |  | $ | 17,112
Less: total net identifiable liabilities assumed |  |  | (565)
Goodwill |  | $ | 17,677
The total consideration of $17.1 million is comprised of $16.3 million in cash, and a $0.8 million payable to the seller. The payable is due upon finalization of a lease assignment for one store location. We continue to refine the valuation data and estimates primarily related to inventory, warranty reserves, intangible assets and real property leases and certain liabilities for the 2021 acquisition and expect to complete the valuations no later than the first anniversary date of the 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. 2020 During 2020, we acquired the following businesses for an aggregate purchase price of $103.7 million. The acquisitions were financed through our Credit Facility. The results of operations for these acquisitions are included in our financial results from the respective acquisition dates. On November 17, 2019, we acquired 18 retail tire and automotive repair stores located in Nevada and Idaho from Nevada Tire Holdings, LLC and Idaho Tire Holdings, LLC. These stores operate under the Tire Choice name. On October 27, 2019, we acquired six retail tire and automotive repair stores located in California from S & S Unlimited, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name. On October 27, 2019, we acquired three retail tire and automotive repair stores located in California from Lloyd’s Tire Service, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name. On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Atlas Tire Center, Inc. This store operates under the Tire Choice name. On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from LRZ3 Auto, LLC. These stores operate under the Tire Choice name. On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from T-Boy's Tire and Automotive, LLC. This store operates under the Tire Choice name. On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from Twin Tire & Auto Care, Inc. These stores operate under the Tire Choice name. On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Twin Tire & Auto Care Team, Inc. This store operates under the Tire Choice name. On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Scotty's Tire & Automotive, Inc. This store operates under the Tire Choice name. On June 23, 2019, we acquired two retail tire and automotive repair stores located in California from BAW LLC. These stores operate under the Tire Choice name. On May 19, 2019, we acquired 40 retail tire and automotive repair stores and one distribution center located in California from Certified Tire & Service Centers, Inc. These stores operate under the Tire Choice name. On March 31, 2019, we acquired 12 retail tire and automotive repair stores located in Louisiana from Allied Discount Tire & Brake, Inc. These stores operate under the Tire Choice name. These acquisitions resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining these businesses with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded certain customer list intangible assets with an average useful life of seven years at their total estimated fair value of approximately $2.8 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease. We expensed all costs related to these acquisitions during 2020. The total costs related to the completed acquisitions were $1.4 million for the year ended March 28, 2020. These costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expense. Sales and net loss for the 2020 acquired locations totaled $59.3 million and ($3.9) million, respectively, for the period from acquisition date through March 28, 2020. The net loss of ($3.9) million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and the benefit from income taxes. 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 accounted for each 2020 acquisition as a business combination using the acquisition method of accounting and we finalized the purchase accounting related to the 2020 acquisitions during 2021. As a result of the final purchase accounting, certain of the fair value amounts previously estimated were adjusted during the measurement period. These measurement period adjustments resulted from updated valuation reports and appraisals received from our external valuation specialists, as well as revisions to internal estimates. The measurement period adjustments were not material to the Consolidated Balance Sheet as of March 27, 2021 and March 28, 2020 and the Consolidated Statement of Income and Comprehensive Income for 2021 and 2020. The acquired assets and liabilities assumed were recorded at their assigned acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The consideration transferred and net liabilities assumed were recorded as goodwill.
2020 Acquisition-date Fair Values Assigned |  |  |
(thousands) |  |  |
Inventories |  | $ | 4,433
Other current assets |  |  | 706
Property and equipment |  |  | 2,405
Finance lease and financing obligation assets, net |  |  | 29,147
Operating lease assets, net |  |  | 42,680
Intangible assets |  |  | 2,847
Other non-current assets |  |  | 374
Long-term deferred income tax assets |  |  | 4,870
Total assets acquired |  |  | 87,462
Current portion of finance leases and financing obligations |  |  | 2,672
Current portion of operating lease liabilities |  |  | 4,416
Deferred revenue |  |  | 1,618
Other current liabilities |  |  | 358
Long-term finance leases and financing obligations |  |  | 36,225
Long-term operating lease liabilities |  |  | 43,668
Other long-term liabilities |  |  | 1,747
Total liabilities assumed |  |  | 90,704
Total net identifiable liabilities assumed |  | $ | (3,242)
Total consideration transferred |  | $ | 103,692
Less: total net identifiable liabilities assumed |  |  | (3,242)
Goodwill |  | $ | 106,934

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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 Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: 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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