BUSINESS ACQUISITIONS |
12 Months Ended |
|---|---|
Jun. 30, 2025 | |
| Business Combination [Abstract] | |
| BUSINESS ACQUISITIONS | (3) BUSINESS ACQUISITIONS Acquisition of IllumiCare On June 13, 2025, the Company, through its wholly owned subsidiary PHSI, acquired 100% of the issued and outstanding capital stock in IllumiCare in a reverse subsidiary merger transaction for a preliminary adjusted purchase price of $47.5 million, net of cash acquired, and subject to certain customary post-closing adjustments. The Company paid $39.8 million with cash on hand, net of cash acquired, of which $4.5 million was placed in escrow to secure primarily certain indemnification obligations of the former IllumiCare owners. The acquisition agreement provides for potential additional contingent earn-out payments to the former IllumiCare owners of up to $15.0 million over a three-year period based upon achievement of certain specified post-closing business performance goals. As of June 30, 2025, the fair value of the earn-out liability was $7.7 million (see Note 6 - Fair Value Measurements), which was included in the adjusted purchase price. The Company has accounted for the IllumiCare acquisition as a business combination whereby the purchase price was allocated to tangible and intangible assets acquired and liabilities assumed based on their fair values. The preliminary fair value assigned to intangible assets acquired was $19.7 million, consisting primarily of developed technology. Other assets and liabilities acquired are not material. The IllumiCare acquisition resulted in the preliminary recognition of $28.9 million of goodwill (see Note 9 - Goodwill and Intangible Assets) attributable to the anticipated profitability of IllumiCare, based on the purchase price paid in the acquisition compared to the fair value of the net assets acquired. The IllumiCare acquisition was considered a stock acquisition for income tax purposes. The initial accounting for the IllumiCare acquisition is preliminarily based upon the Company’s estimates of fair value. The estimated fair values of the assets acquired and liabilities assumed, and the related preliminary acquisition accounting are based on management’s estimates and assumptions, as well as other information compiled by management, including utilization of a benchmarking approach based on the Company’s prior acquisitions to determine preliminary fair values for identified intangible assets. These estimates and assumptions are subject to change during the measurement period, not to exceed one year from the acquisition date, principally related to the valuation of the acquired intangible assets, finalizing the measurement of the acquired net working capital, and the associated income tax considerations. As the initial acquisition accounting is based on preliminary assessments, all amounts could change, potentially materially, as there is significant additional information that the Company must obtain to finalize the valuations of the assets acquired and liabilities assumed, and to establish the value of the acquired intangible assets, due to the proximity of the acquisition date to the balance sheet date of June 30, 2025. The Company believes that the information gathered to date provides a reasonable basis for estimating the preliminary fair values of assets acquired and liabilities assumed. The Company will continue to evaluate these items until they are satisfactorily resolved and will adjust acquisition accounting accordingly, within the allowable measurement period. IllumiCare is reported as part of the Performance Services Segment. Pro forma results of operations for the acquisition have not been presented because the effects on revenue and net income were not material to the Company’s historical consolidated financial statements.
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