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Acquisitions | 9 Months Ended
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Sep. 30, 2024
Acquisitions |
Acquisitions | Note 6. Acquisitions 2022 Acquisitions In April 2022, the Company completed the acquisition of Cell&Co BioServices (“Cell&Co”) in Clermont-Ferrand, France with additional operations in Pont-du-Château, France to further enhance its existing global temperature-controlled supply chain capabilities. Cell&Co is a bioservices business providing biorepository, kitting, and logistics services to the life sciences industry. The purchase consideration was €5.7 million ($6.2 million), comprised of upfront consideration of €3.2 million ($3.5 million) in cash, 15,152 shares of the Company’s common stock with a fair value of $0.4 million, and an earn-out provision with a fair value of €2.0 million ($2.2 million) based on achieving annual EBITDA targets through 2025, as defined in the share purchase agreement, of which $0.3 million was paid to the sellers in 2023. Of the purchase consideration, $2.7 million was allocated to goodwill and $3.4 million to identifiable intangible assets. The acquired goodwill and intangible assets are not deductible for tax purposes. In July 2022, the Company completed the acquisition of Polar Expres based in Madrid, Spain, which provides temperature-controlled logistics solutions dedicated to the life sciences industry. Polar Expres operates logistics centers in Madrid and Barcelona supporting the rapidly growing life science market. This acquisition further expands CRYOPDP’s footprint which enhances our existing global temperature-controlled supply chain capabilities and provides us with additional growth opportunities in the EMEA region. The purchase consideration was €2.8 million ($2.8 million), comprised of cash consideration of €1.4 million ($1.4 million) and an earn-out provision with a fair value of €1.4 million ($1.4 million) based on achieving 2024 and 2026 EBITDA targets as defined in the share purchase agreement. Of the purchase consideration, $1.7 million was allocated to goodwill and $1.0 million to identifiable intangible assets. The acquired goodwill and intangible assets are not deductible for tax purposes. In July 2022, the Company also completed the acquisition of Cell Matters based in Liège, Belgium, which provides cryo-process optimization, cryoprocessing, and cryopreservation solutions to the life sciences industry. The purchase consideration was €3.9 million ($4.0 million). The purchase consideration, including the reimbursement of financial indebtedness at the closing date, in the amount of €4.7 million ($4.7 million) in aggregate was allocated to goodwill. The value of this acquisition is assigned to Cell Matters’ assembled workforce which has significant expertise in cryo-process optimization and cryopreservation. Through September 30, 2023, the Company recorded a measurement period adjustment of $0.1 million comprised of a refund from the sellers following payments made from Cell Matters to the sellers between the locked box date and the closing date, in accordance with the locked box mechanism as defined in the share purchase agreement. The acquired goodwill is not deductible for tax purposes. ​ 2023 Acquisitions ​ In October 2023, the Company completed the asset acquisition of SCI JA8, consisting substantially of real estate property used as administrative offices and a Global Supply Chain Center located in Clermont Ferrand, France. The purchase consideration was €0.6 million ($0.6 million), comprised of property with a fair value of €1.8 million ($1.9 million) and notes payable of €1.0 million ($1.1 million). ​ Tec4med Life Science Acquisition ​ In November 2023, the Company completed the acquisition of TEC4MED LifeScience GmbH (“Tec4med”) based in Darmstadt, Germany. Tec4med provides next generation pharmaceutical supply chain visibility by integrating condition monitoring, cloud and artificial intelligence (AI) solutions. ISO 9001-certified, Tec4med works with pharmaceutical-compliant, ready-to-use devices and software, offering customer-specific integrations. Tec4med broadens Cryoport’s portfolio of condition monitoring solutions and provides additional resources and capabilities to drive new product development and accelerate its European market expansion, particularly in the DACH region (Germany, Austria, Switzerland). The purchase consideration was €3.0 million ($3.2 million), of which €2.5 million ($2.7 million) was allocated to goodwill and €0.3 million ($0.4 million) to identifiable intangible assets. The valuation of the intangible assets and opening balance sheet are preliminary estimates subject to change as we complete our procedures. The acquired goodwill and intangible assets are not deductible for tax purposes. ​ Bluebird Express Acquisition ​ In November 2023, the Company also acquired Bluebird Express, LLC ("Bluebird Express"), a provider of time-sensitive domestic and international transportation services with key operations centers in Los Angeles (LAX) and New York (JFK). Bluebird Express has over 20 years of experience in providing these services, is a fully accredited cargo agent certified by the International Air Transport Association (IATA) and an indirect air carrier (IAC) authorized and regulated by the Transportation Security Administration (TSA). ​ The Bluebird Express acquisition was accounted for under the acquisition method of accounting in accordance with FASB ASC Topic 805, “Business Combinations,” and, therefore, the total purchase price was allocated to the identifiable tangible and intangible assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. Fair values were determined by management based in part on an independent valuation performed by a third-party valuation specialist and required the use of significant assumptions and estimates. Critical estimates included, but were not limited to, future expected cash flows, including projected revenue and expenses, and the applicable discount rates. These estimates were based on assumptions that the Company believes to be reasonable; however, actual results may differ from these estimates. ​ The purchase consideration was $10.2 million, comprised of upfront consideration of $4.5 million and an earn-out provision with a fair value of $5.7 million, based on achieving certain revenue and EBITDA targets through 2026, as defined in the share purchase agreement. Of the purchase consideration, $4.4 million was allocated to goodwill and $3.7 million to identifiable intangible assets. The final purchase price for the Bluebird Express Acquisition was $10.4 million after paying a $0.2 million net working capital settlement to the sellers during the nine months ended September 30, 2024, which was recorded as a measurement period adjustment, resulting in adjusted goodwill of $4.6 million. The acquired goodwill and intangible assets are deductible for tax purposes. ​ The following table summarizes the allocation of the purchase price as of the acquisition date (in thousands): ​
​ | ​ | ​ | ​
Total purchase consideration paid | ​ | $ | 10,229
​ | ​ | ​ | ​
Purchase price allocation: | ​ |  |
Cash and cash equivalents | ​ |  | 868
Accounts receivable | ​ |  | 2,299
Prepaid and other current assets | ​ |  | 38
Property and equipment | ​ |  | 89
Operating lease right-of-use assets | ​ |  | 709
Intangible assets | ​ |  | 3,650
Accounts payable and other accrued expenses | ​ |  | (1,160)
Operating lease liabilities | ​ |  | (709)
Total identifiable net assets | ​ |  | 5,784
Goodwill | ​ |  | 4,445
​ | ​ | $ | 10,229
​ ​ The following table summarizes the estimated fair values of Bluebird Express’ identifiable intangible assets at the date of acquisition and their estimated useful lives and amortization expense based on their respective useful lives (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  |  | ​ |  |  |  |  |  | Annual
​ | ​ | Estimated | ​ | Estimated | ​ | Amortization | ​ | Amortization
​ | ​ | Fair Value | ​ | Useful Life | ​ | Method | ​ | Expense
Customer relationships | ​ | $ | 220 |  | 8.3 |  | Straight-line | ​ | $ | 27
Non-competition agreement | ​ |  | 420 |  | 5 |  | Straight-line | ​ |  | 84
Agent network | ​ |  | 2,890 |  | 4 |  | Straight-line | ​ |  | 723
Trade names/trademarks - finite-lived | ​ |  | 120 |  | 1.5 |  | Straight-line | ​ |  | 80
Total | ​ | $ | 3,650 |  |  |  |  | ​ | $ | 914
​ ​ Goodwill is calculated as the excess of the purchase price over the fair value of net assets acquired and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Among the factors that contributed to a purchase price in excess of the fair value of the net tangible and intangible assets acquired were the acquisition of an assembled workforce, the expected synergies, and other benefits that we believe will result from combining the operations of Bluebird Express with our operations. The goodwill recognized of $4.4 million is deductible for income tax purposes. ​ Acquisition-related transaction costs (included in selling, general and administrative expenses) totaled approximately $0.4 million. ​ Total revenue and net loss would have been $181.7 million and $37.9 million, respectively, for the nine months ended September 30, 2023, if the Company had acquired Bluebird Express on January 1, 2023.

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