v3.26.1
BUSINESS COMBINATION
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
BUSINESS COMBINATION BUSINESS COMBINATION
On July 1, 2025 (“Acquisition Date”), the Company acquired all outstanding equity of Shyft, a niche market leader in specialty vehicle manufacturing and assembly for the commercial and recreational vehicle industries, pursuant to the Merger Agreement. For further information regarding the Merger please refer to “Note 1- Nature of Operations and Basis of Presentation”.

The Company acquired 100% of Shyft’s voting equity interests, with the primary motivation being to enhance the Company’s product offerings in specialty vehicle solutions, expand market share in North America, and leverage Shyft’s innovative design and manufacturing capabilities. Shyft will expand the Company’s ability to provide customized vehicle solutions, including walk-in vans, truck bodies, and luxury Class A diesel motorhome custom chassis to a diverse clientele, including commercial users, original equipment manufacturers, dealers, and governmental entities, thereby providing a diversified portfolio that mitigates risk across various market cycles. Shyft was headquartered in Novi, Michigan, and is integrated into the North America Segment. Shyft’s annual sales in 2024 were $786,176.

The total consideration transferred was approximately $443,103. The assets acquired and liabilities assumed were recorded at their fair values as of the Acquisition Date. The Shyft acquisition was accounted for using the acquisition method of accounting with the purchase price allocated to the assets purchased and liabilities assumed based upon their estimated fair values at the date of acquisition. Identifiable intangible assets include Brand, Technology, Customer relationships and Order backlog. The excess of the purchase price over the estimated fair values of assets acquired and liabilities assumed was recorded as goodwill. In accordance with ASC 805-30-50-1(a), the goodwill recognized in this acquisition is attributed to several qualitative factors, including expected synergies from the integration of the operations of the acquiree and the acquirer, intangible assets that do not qualify for separate recognition, and other relevant factors. All of the goodwill has been assigned to the North America reportable segment. Goodwill totaled $187,903 and is not deductible for tax purposes.

In accordance with ASC 805, the allocation of the purchase price for the acquisition of Shyft was subject to adjustment during the measurement period, which may extend up to one year from the Acquisition Date. The initial allocation of assets acquired and liabilities assumed was based on preliminary estimates and assumptions, and as such, the values assigned to certain working capital balances, identifiable intangible assets, property, plant and equipment, taxes, and contingent liabilities may be adjusted as additional information became available. These adjustments could result in changes to the amounts recognized in the Consolidated Financial Statements, including potential adjustments to the goodwill recognized. The Company continued to refine its estimates and assumptions as it obtained more information, and any adjustments identified during the measurement period were recognized in the reporting period in which the adjustments were determined.
The Company (i) issued and delivered to Shyft shareholders an aggregate of 36,350,634 shares of Aebi Schmidt Common Stock at $12.06 per share, (ii) paid to Shyft fractional shareholders an aggregate amount in cash equal to $2 (the “Cash Consideration”) and (iii) replaced Shyft equity awards amounting to $4,866 that are allocated to consideration transferred as they relate to the pre-acquisition period. The $443,103 of common stock was entirely comprised of Aebi Schmidt Common Stock, par value $1.00.

The purchase price was comprised of the following:

Purchase price:
Aebi shares issued to Shyft shareholders on July 1, 2025 (1)
36,350,634 
Shyft stock price on June 30, 2025 (2)
$12.54 
Exchange ratio1.04 
Share consideration (36,350,634 number of shares issued at the Fair Value of $12.06 per share)
$438,235 
Add: Cash paid for fractional shares2 
Add: Fair value of Shyft Equity awards allocated to pre-acquisition period (3)
4,866 
Total purchase price$443,103 

(1)Includes vested Shyft Director RSU awards.
(2)The fair value of the share consideration and the replacement awards issued to Shyft employees was determined using Shyft’s stock price, as it was considered more reliably measurable than the stock price of Aebi Schmidt. The measurement was based on Shyft’s stock price as of June 30, 2025, the last trading day prior to delisting, which occurred on the Acquisition Date of July 1, 2025.
(3)Represents the estimated fair value of Shyft RSAs, Shyft RSUs (other than Shyft Director RSUs), and Shyft performance stock units (“PSUs”) attributable to pre-combination services. $501 of Shyft RSAs, $1,585 of Shyft RSUs, and $2,780 of Shyft PSUs are attributed to pre-combination service.

The total number of shares of Aebi Schmidt Common Stock issued as consideration, after adjusting for unvested RSAs, vested Director RSUs, and excluding fractional shares settled in cash, was 36,696,981 shares. This total comprises 36,350,634 shares issued to Shyft shareholders, of which 105,874 relating to Aebi Schmidt RSAs exchanged for Shyft RSAs that have not fully vested, and 346,347 shares that accelerated vesting upon a termination and change in control (double trigger provision). For further information regarding stock based compensation, please refer to “Note 13 - Stock Based Compensation and Equity” in the Company's Form 10-K.

Acquisition costs in connection with the Merger incurred by the Company include acquisition-related legal and other professional fees in the total amount of $19,169 as of the Acquisition Date, which are recognized as $14,765 and $4,404 in the income statement for the year ended December 31, 2025 and 2024, respectively. All amounts were recorded within other income (expense) for the respective periods.

The table below presents the purchase price allocation to the fair value of identifiable assets acquired and liabilities assumed as of the Acquisition Date. Measurement period adjustments were based upon information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the measurement of the amounts recognized at that date. In the fourth quarter of 2025, the Company recorded measurement period adjustments to cash and cash equivalents, other current liabilities and accrued expenses, and intangible assets. We also adjusted deferred tax liabilities in the fourth quarter of 2025 to reflect measurement‑period refinements to our estimated deferred tax calculation. In the first quarter of 2026, the Company recorded measurement period adjustments to other current liabilities and accrued expenses. In the second quarter of 2026, the Company recorded measurement period adjustments to inventory and other current liabilities, and adjusted the deferred tax liabilities to reflect the measurement period adjustments. The offset to these adjustments were recorded as a net decrease to goodwill.
The purchase price allocation to the fair value of assets acquired and liabilities assumed is as follows:

Purchase Price AllocationMeasurement Period AdjustmentsPurchase Price Allocation (As Adjusted)
Fair value of identifiable assets and liabilities:
Cash and cash equivalents$19,905 $(539)$19,366 
Accounts receivable84,121 84,121 
Contract assets44,559 44,559 
Inventories91,117 (7,228)83,889 
Prepaid expenses and other current assets8,191 8,191 
Total current assets247,893 (7,767)240,126 
Property, plant and equipment101,832 101,832 
Goodwill193,960 (6,057)187,903 
Intangible assets181,104 3,927 185,031 
Right of use assets operating leases47,347 47,347 
Other assets1,317 1,317 
Total Assets$773,453 $(9,897)$763,556 
Accounts payable$80,844 $80,844 
Accrued warranty6,782 6,782 
Accrued compensation and related taxes11,174 11,174 
Contract liabilities9,123 9,123 
Operating lease liability9,221 9,221 
Other current liabilities and accrued expenses25,574 6,322 31,896 
Current portion of long-term debt452 452 
Current liabilities$143,170 $6,322 $149,492 
Other non-current liabilities12,205 12,205 
Long-term operating lease liability34,346 34,346 
Long-term debt, less current portion120,344 120,344 
Deferred tax liabilities20,285 (16,219)4,066 
Total Liabilities330,350 (9,897)320,453 
Total fair value allocation of purchase price$443,103 $— $443,103 

The value of accounts receivables acquired approximates the gross contractual amount of accounts receivable. The contractual amount not expected to be collected is immaterial.

As part of the business combination, the Company recognized contingent liabilities of $8,246 related to certain commitments. The Company measured these contingencies at fair value and the liabilities reflect management's best estimate of future payments related to these arrangements, which depends on final negotiated terms following the acquisition. The valuation incorporates probability-weighted scenarios based on expected outcomes. The Company continues to monitor these arrangements and will adjust the fair value as necessary in future reporting periods.

Intangible assets totaling $185,031 have been assigned to Brand, Technology, Customer relationships and Order backlog as a result of the acquisition. The fair value of Customer relationships was determined using an income approach methodology, specifically the multi-period excess earnings method. The fair value of Brand and Technology was determined using an income approach methodology, specifically the relief from royalty method. Significant assumptions used in estimating future cash flows included projected revenue growth rates and discount rate for customer relationships and projected revenue growth rates, royalty rate and discount rate for brand. Intangible assets consist of the following (in thousands):
AmountUseful life (in years)Weighted average amortization period (in years)
Brand$60,765 
5 - 20
18
Technology26,068 1010
Customer relationships93,046 1515
Order backlog5,152 11
$185,031 15

The Company amortizes the Brand, Technology, Customer relationships and Order backlog utilizing a straight-line approach.

For the three and six months ended June 30, 2026, Shyft generated revenue of $210,908 and $397,212 and operating income of $13,677 and $15,328, respectively, which are included in the accompanying condensed consolidated financial statements.

The Company has applied the practical expedient in ASC 805-20-30-29 for contract assets and contract liabilities acquired in the business combination. Acquired contract assets and liabilities in the scope of ASC 606 are an exception to the ASC 805 fair value measurement principle and were measured as if Aebi Schmidt had originated the acquired contract. For each contract Aebi Schmidt reassessed the identification of performance obligations, determination of transaction price, allocation of transaction price, and measure of progress for each performance obligation as if Aebi Schmidt has been party to the original contract and recognized the resulting contract asset or liability as an asset acquired or a liability assumed. The application of this expedient aligns with the acquiree’s historical accounting and is not expected to materially affect the condensed consolidated financial statements. The Company continues to evaluate the impact of these items in subsequent periods as part of its ongoing revenue recognition processes.