What was the total purchase price paid by 1 800 Packouts for Mosquito Shield?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
chase agreement included payment of rollover interest of $2,000,000 wherein the former owner was granted an ownership interest in the Company, which was included in the total consideration paid for the acquisition.
In relation to these acquisitions, the Company elected to early adopt Accounting Standards Update 2021-08, Business Combinations (ASU 2021-08). ASU 2021-08 allows a Company to recognize and measure contract assets and contract liabilities in accordance with ASC 606, Revenue from Contracts with Customers. Accordingly, the contract assets and contrac
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the total purchase price for Mosquito Shield was $27,905,862. This figure represents the estimated fair value of assets acquired and liabilities assumed by 1 800 Packouts during the acquisition. The acquisition agreement was formalized on March 11, 2022, through a securities purchase agreement to acquire 100% of the equity interests in Mosquito Shield Finance Corporation.
The purchase agreement included a rollover interest payment of $2,000,000, where the former owner received an ownership interest in the company. This rollover interest was factored into the total consideration paid for Mosquito Shield. The assets acquired included cash, accounts receivable, contract assets, other assets, trade name, franchise agreements, and goodwill, while the liabilities assumed were deducted from the total.
For a prospective franchisee, understanding the financial structure of 1 800 Packouts's acquisitions can provide insight into the company's growth strategy and financial health. The allocation of purchase price to different asset categories, such as trade name, franchise agreements, and goodwill, reflects the value 1 800 Packouts places on these intangible assets. This information can be useful for assessing the long-term potential and stability of the franchise system.