Redeemable Non-Controlling Interest

6 Months Ended

Jun. 30, 2023


14.			Redeemable Non-Controlling Interest

On March 5, 2019, the Company acquired Discovery Benefits from SBI, who obtained a 4.9 percent equity interest in PO Holding. The equity interest was puttable under the agreement, making the non-controlling interest redeemable and therefore, it was classified as temporary equity outside of stockholders’ equity. As part of WEX Inc.’s purchase of the HSA contractual rights from Bell Bank on April 1, 2021, SBI’s ownership percentage was reduced to 4.53 percent.

On March 7, 2022, WEX Inc. purchased SBI’s remaining 4.53 percent interest in PO Holding for a deferred purchase price of $234.0 million plus any interest accruing pursuant to the terms of the purchase agreement and recorded the liability at a net present value of $216.6 million. The carrying value of the redeemable non-controlling interest immediately prior to the acquisition date was $254.4 million and therefore, the $37.8 million excess carrying value as of the acquisition date was recorded within the change in value of redeemable non-controlling interest on the condensed consolidated statements of operations, offset by $3.5 million of deferred tax expense resulting from the difference between the book and tax bases of the deferred liability payable to SBI. As a result of the acquisition, the carrying value of the redeemable non-controlling interest was reduced to zero and WEX Inc. owns 100 percent of PO Holding.