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15.  BUSINESS COMBINATIONS

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Acquiring businesses is a key part of our ongoing strategy to grow our company and expand our offerings. Each acquisition has been accounted for as a business combination under ASC 805, “Business Combinations.” Acquisition-related costs for the years ended December 31, 2024 and 2023, were $27.9 million and $16.2 million, respectively. Acquisition-related costs for the year ended December 31, 2024 includes $23.0 million paid in connection with the mutual termination of our previous agreement to acquire SPI. Acquisition-related costs are included in selling, general, and administrative expense in our Consolidated Statements of Operations.

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On February 15, 2024, we acquired the assets of the residential and light commercial insulation business Brabble. This installation acquisition enhanced our presence in North Carolina. The purchase price of $5.4 million was funded by cash on hand and we recognized $2.9 million of goodwill in connection with this acquisition.

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On March 1, 2024, we acquired the assets of the residential insulation business Morris Black. This installation acquisition enhanced our presence in Pennsylvania. The purchase price of $3.6 million was funded by cash on hand and we recognized $2.0 million of goodwill in connection with this acquisition.

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On March 1, 2024, we acquired the assets of the customized insulation products and accessories business PCI. This specialty distribution acquisition has a national customer base focused on the domestic pest control industry. The purchase

price of $13.8 million was funded by cash on hand and we recognized $5.7 million of goodwill in connection with this acquisition.

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On April 18, 2024, we acquired the assets of the residential and light commercial insulation business Green Space. This installation acquisition enhanced our presence in Missouri and neighboring states. The purchase price of approximately $4.3 million was funded by cash on hand and we recognized $2.6 million of goodwill in connection with this acquisition.

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On May 16, 2024, we acquired the assets of the residential and light commercial insulation business Insulation Works. This installation acquisition enhanced our presence in Arkansas and extended our expertise to the agricultural business. The purchase price of approximately $25.5 million was funded by cash on hand and we recognized $14.9 million of goodwill in connection with this acquisition.

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On May 31, 2024, we acquired the assets of the residential and light commercial insulation business Texas Insulation. This installation acquisition enhanced our presence in Texas. The purchase price of approximately $35.9 million was funded by cash on hand and we recognized $22.8 million of goodwill in connection with this acquisition.

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On December 2, 2024, we acquired the assets of Shannon, which designs and fabricates reusable thermal, acoustical and safety products to multinational customers. This specialty distribution acquisition enhances our capabilities in mechanical insulation and our fabrication offerings to commercial and industrial end user markets. The purchase price of approximately $12.9 million was funded by cash on hand and we recognized $6.1 million of goodwill in connection with this acquisition.

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On December 2, 2024, we acquired the assets of the commercial and industrial mechanical insulation distributor business of Metro. This specialty distribution acquisition enhances our presence in the New York/New Jersey and the Baltimore/Washington metropolitan areas. The purchase price of approximately $35.4 million was funded by cash on hand and we recognized $18.0 million of goodwill in connection with this acquisition.

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The table below provides a summary of businesses acquired in 2024 including the net sales and net income incurred for the year ended December 31, 2024:

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The estimated fair values of the assets acquired and liabilities assumed for our 2024 acquisitions are as follows as of December 31, 2024, in thousands:

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The estimate of acquired customer relationships related to our 2024 acquisitions was $42.2 million and the weighted average useful life is 12 years.

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On January 26, 2023, we acquired the assets of the residential insulation business of SRI. This installation acquisition enhanced our presence in Georgia, Michigan, Ohio, Florida, Alabama and South Carolina. The purchase price of $45.3 million was funded by cash on hand.

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On July 17, 2023, we acquired the assets of the residential insulation business Best. This installation acquisition enhanced our presence in Texas, Arizona, Tennessee, and Florida markets. The purchase price of $94.6 million was funded by cash on hand.

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The table below provides a summary of businesses acquired in 2023 including the net sales and net income incurred for the year ended December 31, 2024:

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The table below represents the finalized fair values of assets acquired and liabilities assumed as of December 31, 2024, for the acquisitions made during the year ended December 31, 2023:

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Purchase Price Allocations

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As third-party or internal valuations are finalized, certain tax aspects of the foregoing transactions are completed, and customer post-closing reviews are concluded, adjustments may be made to the fair value of assets acquired, and in some cases total purchase price, through the end of each measurement period, generally one year following the applicable acquisition date.

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Goodwill to be recognized in connection with acquisitions is attributable to the synergies expected to be realized and improvements in the businesses after the acquisitions.  Primarily all of the goodwill recorded during the years ended December 31, 2024 and 2023, respectively, is deductible for income tax purposes.