Quarterly report pursuant to Section 13 or 15(d)

Goodwill

v3.19.3
Goodwill
 6 Months Ended
Aug. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL GOODWILL

The changes in the carrying amount of goodwill are as follows:
 
Beer
 
Wine and Spirits
 
Consolidated
(in millions)
 
 
 
 
 
Balance, February 28, 2018
$
5,157.6

 
$
2,925.5

 
$
8,083.1

Purchase accounting allocations (1)
22.3

 
2.7

 
25.0

Foreign currency translation adjustments
(12.0
)
 
(7.3
)
 
(19.3
)
Balance, February 28, 2019
5,167.9

 
2,920.9

 
8,088.8

Purchase accounting allocations (2)
—

 
58.8

 
58.8

Foreign currency translation adjustments
(26.0
)
 
(9.1
)
 
(35.1
)
Reclassified to assets held for sale (3)
—

 
(415.8
)
 
(415.8
)
Balance, August 31, 2019
$
5,141.9

 
$
2,554.8

 
$
7,696.7


(1) 
Purchase accounting allocations associated primarily with the acquisition of Four Corners (Beer). See defined acquisition term below.
(2) 
Preliminary purchase accounting allocations associated primarily with the acquisition of Nelson’s Green Brier (Wine and Spirits). See defined acquisition term below.
(3) 
In connection with the Wine and Spirits Transaction and the Black Velvet Transaction, goodwill associated with the businesses being sold were reclassified to assets held for sale based on the relative fair values of the portion of the business being sold and the remaining wine and spirits portfolio. The relative fair values were determined using the income approach based on assumptions, including projected revenue growth rates, terminal growth rate, and discount rate and other projected financial information.

Acquisitions
Nelson’s Green Brier
In May 2019, we increased our ownership interest in Nelson’s Green Brier Distillery, LLC (“Nelson’s Green Brier”) to 75%, resulting in consolidation of the business and recognition of a noncontrolling interest. This acquisition included a portfolio of award-winning, Tennessee-based craft bourbon and whiskey products. The preliminary fair value of the business combination was allocated primarily to goodwill, trademarks, inventory, and property, plant, and equipment. The results of operations of Nelson’s Green Brier are reported in the Wine and Spirits segment and have been included in our consolidated results of operations from the date of acquisition.

We recognized a gain of $11.8 million for the six months ended August 31, 2019, related to the remeasurement of our previously held 20% equity interest in Nelson’s Green Brier to the acquisition-date fair value. This gain is included in selling, general, and administrative expenses within our consolidated results of operations.

Four Corners
In July 2018, we acquired Four Corners Brewing Company LLC, which included a portfolio of high-quality, dynamic, and bicultural, Texas-based craft beers (“Four Corners”). The purchase price was primarily allocated to goodwill, property, plant, and equipment, and trademarks, plus an earn-out over five years based on the performance of the brands. The results of operations of Four Corners are reported in the Beer segment and have been included in our consolidated results of operations from the date of acquisition.