Business Combinations

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

BUSINESS COMBINATIONS

Note 2 — BUSINESS COMBINATIONS

On December 19, 2019, we entered into a definitive share purchase agreement (the Agreement) with Clariant AG, a corporation organized and existing under the laws of Switzerland (Clariant), and through one of our wholly owned subsidiaries, a definitive business transfer agreement (the BTA), with Clariant Chemicals (India) Limited, a public limited company incorporated in India and an indirect majority-owned subsidiary of Clariant (Clariant India). Pursuant to the Agreement and the BTA, on July 1, 2020, we completed our acquisition of all of the equity interests in Clariant's global masterbatch business and Clariant India's masterbatch business assets in India. The businesses are collectively referred to as Clariant MB and the acquisitions are collectively referred to as the Clariant MB Acquisition. The Clariant MB Acquisition is further discussed in Note 14, Subsequent Events.

Our acquisitions of PlastiComp, Inc. (PlastiComp) on May 31, 2018 and Fiber-Line, LLC (Fiber-Line) on January 2, 2019 involve contingent earnout consideration. The PlastiComp earnout has a ceiling of $35.0 million, which was reached during the first quarter of 2020 and is reflected within Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. The Fiber-Line earnout is based on two annual earnout periods, with the second earnout period target based on year-one results. Amounts related to the first Fiber-Line earnout period were paid in the first quarter of 2020. During the three months ended March 31, 2020, earnout charges of $1.0 million were recorded within Selling and administrative expense on the Condensed Consolidated Statements of Income, primarily attributable to improved earnings from the acquisitions. No additional earnout adjustments were recorded in the three months ended June 30, 2020.