|9 Months Ended|
Oct. 01, 2016
|Business Combinations [Abstract]|
On August 31, 2016, the Company acquired 100 percent of ICG, a market leader specializing in the design of indoor cycling equipment, which is based in Nuremburg, Germany. The addition of ICG strengthens the Company's position in indoor cycling and provides a strong foundation to expand in the growing group exercise market. ICG is managed as part of the Company's Fitness segment.
The Company acquired ICG for total consideration of $54.1 million, including $51.7 million of cash paid during the third quarter of 2016. The preliminary recording of the fair value of the assets acquired and liabilities assumed resulted in $20.4 million of identifiable intangible assets, including customer relationships, trade names and patents and proprietary technology for $11.2 million, $6.0 million and $3.2 million, respectively, along with $26.0 million for goodwill which is not deductible for tax purposes. The amounts assigned to ICG's customer relationships and patents and proprietary technology will be amortized over the estimated useful life of approximately 11 years and 5 years, respectively. These amounts recorded are preliminary and are subject to change within the measurement period as the Company finalizes its fair value estimates.
On July 1, 2016, the Company acquired substantially all of the assets of privately held Thunder Jet Boats, Inc. (Thunder Jet), a designer and builder of heavy-gauge aluminum boats, which is based in Clarkston, Washington. Thunder Jet offers a lineup of 18 models ranging in length from 18-26 feet and adds breadth and depth to the Company's overall product portfolio. Thunder Jet is managed within the Company's Boat segment.
The cash consideration the Company paid to acquire Thunder Jet was $20.9 million. The preliminary recording of the fair value of the assets acquired and liabilities assumed resulted in $10.8 million of identifiable intangible assets, including customer relationships and trade names for $5.4 million each, along with $2.5 million of goodwill which is deductible for tax purposes. The amount assigned to Thunder Jet's customer relationships will be amortized over the estimated useful life of 15 years. These amounts are preliminary and are subject to change within the measurement period as the Company finalizes its fair value estimates.
On January 20, 2016, the Company acquired 100 percent of privately held Cybex, a leading manufacturer of commercial fitness equipment, which is currently based in Medway, Massachusetts. Cybex offers a full line of cardiovascular and strength products and had unaudited sales in 2015 of approximately $169 million. The addition of Cybex expands the Fitness segment's participation in key markets, including commercial fitness, and adds to the Company's manufacturing footprint to meet current and future demand more effectively. Cybex also increases the breadth and depth of the segment's product portfolio. Cybex is managed within the Company's Fitness segment.
The following table is a summary of the assets acquired, liabilities assumed and net cash consideration paid for the Cybex acquisition during 2016:
(A) The goodwill recorded for the acquisition of Cybex is not deductible for tax purposes.
(B) These amounts are subject to change within the measurement period as the Company finalizes its fair value estimates.
(C) Net cash consideration paid includes a purchase price adjustment of $1.9 million in the third quarter of 2016.
These acquisitions are not material to the Company's net sales, results of operations or total assets during any period presented. Accordingly, the Company's consolidated results from operations do not differ materially from historical performance as a result of these acquisitions and, therefore, pro forma results are not presented.
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).
Reference 1: http://www.xbrl.org/2003/role/presentationRef