Business Acquisitions |
3 Months Ended |
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Dec. 31, 2019 | |
| Business Combinations [Abstract] | |
| Business Acquisitions | Business Acquisitions
On October 1, 2019, a subsidiary of the Company acquired substantially all of the assets of an HMA manufacturing plant and paving company located in Palm City, Florida. The acquired business is expected to benefit from geographic synergies resulting from its proximity to the Company’s preexisting operations in central Florida, including its Okeechobee, Florida HMA plant and office, which the Company acquired in February 2019. The acquisition has been accounted for as a business combination in accordance with ASC Topic 805, Business Combinations. The purchase price of $17.7 million was paid from cash on hand at closing.
The provisional allocation of the purchase price to assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, was determined in accordance with the methodology described under Fair Value Measurements in Note 2 - Significant Accounting Policies to the Company’s audited financial statements for the fiscal year ended September 30, 2019. The provisional amounts allocated are $9.6 million of property, plant and equipment, $1.2 million of other current assets and $6.9 million of goodwill. Goodwill, which is deductible for income tax purposes, primarily represents the assembled work force synergies expected to result from the acquisition. Upon finalizing the accounting for this transaction, management expects to ascribe value to other identifiable intangible assets, including customer relationships and customer backlog, which will reduce the preliminary amount allocated to goodwill.
The results of operations since the October 1, 2019 acquisition date attributable to this acquisition are included in the consolidated financial statements since the acquisition date and were not material to the Consolidated Statements of Income for the three months ended December 31, 2019. Pro forma results of operations as if the acquisition had been consummated October 1, 2018 would not be material to the Consolidated Statements of Income. The Company recorded certain costs to effect the acquisition as they were incurred, which are reflected in general and administrative expenses on the Company’s Consolidated Statements of Income in the amount of $0.1 million for the three months ended December 31, 2019.
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