11. ACQUISITIONS

Heany Industries, LLC

Effective  January 2, 2024, Heany Industries, LLC, a Delaware limited liability company and indirect wholly-owned subsidiary of Crawford United Corporation, completed the acquisition of all of the operating assets of Heany Industries, Inc, a New  York corporation and specialist in materials engineering solutions for a variety of aerospace, industrial and bio-medical applications pursuant to an Asset Purchase Agreement. The acquired business is strategically important to the Company’s growing aerospace presence and has expanded the Company's offerings and diversified its customer base. The purchase price after working capital adjustment was $6.6 million of cash and inclusive of the real estate on which Heany operates. The purchase price allocation is complete. During the first quarter of 2025, final fair market value reductions to fixed assets and inventory were recorded for $154,024, with the corresponding adjustment being an increase to goodwill.

Goodwill has an assigned value of $1.2 million and represents the expected synergies generated by combining the operations of Heany and the Company. The Company was a long-time customer of Heany and the acquisition allows for a strengthening of the Company's supply chain. The acquired customer relationships have an assigned intangible asset value of $1,934,000, which was determined using an income approach and will be amortized on a straight-line basis over 15 years. The residual intangible asset value of $51,000 relates to trademarks.

Advanced Industrial Coatings, LLC

Effective  August 30, 2024, Advanced Industrial Coatings LLC, a Delaware limited liability company and indirect wholly-owned subsidiary of Crawford United Corporation, completed the acquisition of substantially all the assets of Advanced Industrial Coatings, Inc., a California corporation and specialist in fluoropolymers and other high-performance coatings solutions for the aerospace, semiconductor, medical, energy and other industrial sectors, pursuant to an Asset Purchase Agreement. The acquired business is strategically important to the Company’s growing aerospace presence and has expanded the Company's offerings and diversified its customer base. 

The Company has substantially completed the purchase price allocation, reflecting estimates of the fair values of assets acquired and liabilities assumed as of the acquisition date. While we  may record minor adjustments to inventory within the measurement period, we do not expect any material changes to the purchase price allocation.

Goodwill has an assigned value of $1.0 million and represents the expected synergies generated by combining the operations of AIC and the Company. The acquired customer relationships have an assigned intangible asset value of $1.4 million, which was determined using an income approach and will be amortized on a straight-line basis over 15 years. 

Rahn Industries Incorporated

Effective  January 2, 2025, Crawford AE LLC, an Ohio limited liability company (“Air Enterprises”) and wholly-owned subsidiary of Crawford United Corporation, completed the acquisition of all of the issued and outstanding shares of capital stock of Rahn Industries, Incorporated, a California corporation. Rahn is a leading manufacturer of HVAC coils and related coatings, serving both OEM and aftermarket customers in the healthcare, industrial, energy, and defense industries. The purchase price after working capital adjustment was $12.7 million in cash. 

The Company has made substantial progress with the purchase price allocation, reflecting estimates of the fair values of assets acquired and liabilities assumed as of the acquisition date. We  may record fair value adjustments, particularly to inventory, fixed assets or deferred taxes, as additional information becomes available within the measurement period regarding circumstances existing at the acquisition date.

Goodwill has an assigned value of $3.9 million and represents the expected synergies generated by combining the operations of Rahn and the Company. While not previously a customer, Rahn produces air handling coils, which represent the single largest expenditure in the Company's supply chain. The acquired customer relationships have an assigned intangible asset value of $4.1 million, which was determined using an income approach and will be amortized on a straight-line basis over 15 years. .

Sales and Net Income (Loss) for the Acquired Companies

Sales and net income (loss) information for Heany, AIC and Rahn since their respective acquisition dates for the three and six months ended June 30, 2025 and 2024 are provided below.