BUSINESS COMBINATIONS |
6 Months Ended |
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Jun. 30, 2026 | |
| Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract] | |
| BUSINESS COMBINATIONS | BUSINESS COMBINATIONS Linq Venture Holdings LLC The Company accounts for acquisitions in accordance with guidance found in ASC 805, Business Combinations (“ASC 805”). The guidance requires consideration given, including contingent consideration, assets acquired, and liabilities assumed to be valued at their fair values at the acquisition date. The guidance further provides that: (1) acquisition costs will generally be expensed as incurred, (2) restructuring costs associated with a business combination will generally be expensed subsequent to the acquisition date; and (3) changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date generally will affect income tax expense. ASC 805 requires that any excess of purchase price over fair value of assets acquired, including identifiable intangibles and liabilities assumed, be recognized as goodwill. On January 1, 2026, the Company executed a call option and acquired the remaining 51% equity interest in Linq Venture Holdings LLC (“Linq”) for cash consideration of $6.4 million and $18.6 million of a preexisting note receivable that was forgiven, where the value was determined using current market transactions for similar items. The acquisition was achieved in stages with the fair value of the call option at $(0.1) million and the previously held 49% equity interest was remeasured to $6.1 million. This resulted in a $6.0 million reduction to General and administrative expenses in the Condensed Consolidated Statements of Operations. Linq supports the development and scaling of a digital marketplace in and for the transportation and logistics distribution industry and serves as the digital channel for marketing Wabash products to end-customers and dealers. Linq became a wholly-owned subsidiary of the Company and Linq’s financial position and results are consolidated with those of the Company as of January 1, 2026. The revenue and earnings of Linq for 2026 are not material. The Company previously accounted for its 49% interest in Linq Venture Holdings LLC as an equity method investment. Linq is included within the Parts and Services reportable segment. The fair value of the acquired business was determined to be $31 million using the income approach, specifically a discounted cashflow (DCF) method. The valuation was supported by prospective financial inputs from management including estimated revenues based on brokerage and software fees at 28% of supported recurring revenues. Estimated operating expenses were primarily related to ongoing software costs, salaries, and benefits. Due to the execution risk and market uncertainty inherent in second state, expansion technology ventures, a discount rate in the lower end of the range of 30% to 35% was considered appropriate and applied to the cash flows. Initial accounting for the business combination is incomplete pending finalization of the valuation of certain tangible and intangible assets. Consequently, provisional amounts for these assets have been recorded based on the information currently available. The provisional amounts are as follows: Intangible assets $30.1 million and other net assets of $0.9 million. Intangible assets include internal use software that is tentatively valued at cost of $8.0 million with a 5 year life. The Company recognized $22.1 million of goodwill in connection with the Linq acquisition which represents a premium paid for strategic benefits related to the expansion of a digital ecosystem supporting the growth of recurring revenue streams. The goodwill from this transaction is deductible for tax purposes.
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