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BUSINESS ACQUISITION (Notes) | 12 Months Ended
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Jul. 25, 2020
Business Combinations [Abstract] |
BUSINESS ACQUISITION | BUSINESS ACQUISITIONS Fairway Acquisition On May 14, 2020, Village completed its acquisition of certain assets, including five supermarkets averaging 52,000 sq. ft. (30,000 selling sq. ft.), a production distribution center (the “PDC”) and the intellectual property of Fairway Group Holdings Corp. and certain of its subsidiaries (“Fairway”), including the names “Fairway” and “Fairway Markets.” Four of the supermarkets are in Manhattan, specifically the Upper West Side, Upper East Side, Kips Bay and Chelsea locations, and a fifth store is located in Pelham, NY. The acquisition was effectuated pursuant to the Asset Purchase Agreement (the "APA"), entered into on January 20, 2020, revised on March 25, 2020 and approved by the United States Bankruptcy Court for the Southern District of New York through a Sale Order entered on April 20, 2020. Village paid $73,622 for the Fairway assets, net of cash acquired, and assumed certain liabilities, consisting primarily of those arising from acquired leases. Additionally, at the time of closing Village received a $2,035 credit arising from the breakup of Village’s initial “stalking horse” bid under the January 20, 2020 Asset Purchase Agreement. The credit was recognized as a reduction in operating and administrative expense in the fourth quarter of fiscal 2020. The Fairway acquisition expands our presence in New York City under an iconic city brand and provides Village the ability to expand centralized food production to support stores under all of our banners. Village accounted for this transaction as a business combination in accordance with the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date. In connection with this acquisition, the Company recorded $11,540 of goodwill attributable to the assembled workforce and cost synergies. The goodwill related to this acquisition is deductible for tax purposes. Additionally, the Company recorded a $14,200 indefinite-lived intangible asset related to the trade name. The fair value of the intangible asset was determined based on the discounted cash flow model using the relief from royalty method. The fair value of the property, equipment and fixtures were determined based on the indirect cost approach in which current costs that were not new were adjusted for all forms of depreciation. The Company also evaluated the fair value of the leases assumed in the acquisition, which evaluated comparable rents in the areas of the locations. Leases were determined to be at market apart from one location. For this location, the Company recorded a favorable lease of $4,360 within Operating lease assets. The favorable lease is being amortized over the remaining duration of the lease. Transaction costs were expensed as incurred. The allocation of the purchase price consideration to the assets acquired and the liabilities assumed will be completed upon the finalization of working capital adjustments. The following table summarizes how the purchase price has been allocated to the assets acquired and liabilities assumed at the date of acquisition.
| May 14, 2020
ASSETS |
Current Assets |
Cash and cash equivalents | $ | 257 |
Merchandise inventories | 5,390 |
Other current assets | 247 |
Total current assets | $ | 5,894 |
Property, equipment and fixtures, net | $ | 37,006 |
Operating lease assets | 218,326 |
Trade name intangible asset | 14,200 |
Other assets | 271 |
Total assets | $ | 275,697 |
LIABILITIES |
Accrued wages and benefits | $ | 623 |
Operating lease obligations | 212,735 |
Total liabilities | $ | 213,358 |
Total Net Assets Acquired | $ | 62,339 |
Goodwill | 11,540 |
Total Purchase Price | $ | 73,879 |
The pro forma information includes historical results of operations of the Fairway locations acquired but does not include efficiencies, cost reductions, synergies or investments for the Company’s customers expected to result from the acquisitions. The unaudited pro forma financial information in the table below is not necessarily indicative of the results that would have occurred had the Fairway locations been acquired at the beginning of fiscal year 2019.
| Years ended |  |
| July 25, 2020 |  | July 27, 2019
Sales | $ | 2,034,163 |  |  | $ | 1,934,426 |
Net Income | 30,313 |  |  | 36,594 |
Gourmet Garage Acquisition On June 24, 2019, the Company purchased three Gourmet Garage specialty markets in Manhattan, New York City. Village acquired the store fixtures, leases, inventory, other working capital and other assets for $5,267, net of cash and cash equivalents. Village has accounted for this transaction as a business combination in accordance with the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date. In connection with this acquisition, the Company recorded $593 of goodwill attributable to the assembled workforce of Gourmet Garage and cost synergies and a $1,485 indefinite-lived intangible asset related to the trade name. Transaction costs were expensed as incurred. The final allocation of the purchase price consideration to the assets acquired and the liabilities assumed has been completed. The following table summarizes how the purchase price has been allocated to the assets acquired and liabilities assumed at the date of acquisition:
| June 24, 2019
ASSETS |
Current Assets |
Cash and cash equivalents | $ | 24 |
Merchandise inventories | 564 |
Other current assets | 49 |
Total current assets | $ | 637 |
Property, equipment and fixtures, net | $ | 3,475 |
Trade name intangible asset | 1,485 |
Other assets | 255 |
Total assets | $ | 5,852 |
LIABILITIES |
Total current liabilities | $ | 1,154 |
Total Net Assets Acquired | $ | 4,698 |
Goodwill | 593 |
Total Purchase Price | $ | 5,291 |

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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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