Booz Allen Hamilton Holding Corp
For the period ended Dec 31, 2024. Filed Jan 31, 2025.
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Dec 31, 2024 · Filed Jan 31, 2025
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5. Acquisition, Goodwill and Intangible Assets
- Acquisition, Goodwill and Intangible Assets
Acquisition
On June 7, 2024, the Company completed the acquisition of PAR Government Systems Corporation (“PGSC”), a wholly owned subsidiary of PAR Technology Corporation, for approximately$98.7 million, net of post-closing adjustments and incurred transaction costs as part of the acquisition. PGSC was founded in 1985 and headquartered in Rome, New York, and delivers differentiated services and solutions in strategic mission areas, including the provision of real-time communications and mobile situational awareness to maintain battlespace dominance for a range of government customers. The acquisition was funded with cash on hand. As a result of the transaction, PGSC became a wholly owned subsidiary of Booz Allen Hamilton Inc.
The acquisition was accounted for under the acquisition method of accounting, which requires the total acquisition consideration to be allocated to the assets acquired and liabilities assumed based on an estimate of the acquisition date fair value, with the difference reflected in goodwill. The Company completed the determination of fair values of the acquired assets and liabilities assumed during the third quarter of fiscal 2025, except for the purchase price allocation for federal income tax purposes, which is in the process of being finalized.
The goodwill recognized of $61.1 million is primarily attributable to PGSC’s specialized workforce and the expected synergies between the Company and PGSC, and is deductible for tax purposes. The intangible assets recognized of$27.0 million consist primarily of contract assets and are being amortized over the estimated useful life oftwelve years.
Goodwill
As of December 31, 2024 and March 31, 2024, goodwill was $2,404.9 million and $2,343.8 million, respectively. The$61.1 million increase in the carrying amount of goodwill was attributable the Company's acquisition of PGSC.
Intangible Assets
Intangible assets consisted of the following:
| December 31, 2024 | March 31, 2024 | |||||
|---|---|---|---|---|---|---|
| Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | |
| Amortizable intangible assets: | ||||||
| Customer contracts and related customer relationships | $618,894 | $287,326 | $331,568 | $591,895 | $237,764 | $354,131 |
| Software | 169,110 | 110,816 | 58,294 | 146,284 | 89,572 | 56,712 |
| Total amortizable intangible assets | $788,004 | $398,142 | $389,862 | $738,179 | $327,336 | $410,843 |
| Unamortizable intangible assets: | ||||||
| Trade name | $190,200 | $— | $190,200 | $190,200 | $— | $190,200 |
| Total | $978,204 | $398,142 | $580,062 | $928,379 | $327,336 | $601,043 |
The $49.8 million increase in the gross carrying amount of intangible assets was primarily attributable the Company's acquisition of PGSC, with the remainder resulting from increases in the Company’s internally developed software.
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