Business Combinations (Tables)

9 Months Ended

Sep. 30, 2020

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The Company completed the acquisition of privately-held Cloverleaf on May 1, 2019. A summary of the final fair value of the assets acquired and liabilities assumed for total cash consideration of $1.24 billion, as well as adjustments made during the measurement period, is as follows (in thousands):


	Amounts Recognized as of the Acquisition Date		Measurement Period Adjustments (1)		Final Amounts Recognized as of the Acquisition Date (as Adjusted)(2)
Assets
Land	$	59,363	$	1,131	$	60,494
Building and improvements	687,821		(19,670)		668,151
Machinery and equipment	144,825		822		145,647
Assets under construction	20,968		(3,994)		16,974
Operating lease right-of-use assets	1,254		—		1,254
Cash and cash equivalents	4,332		—		4,332
Restricted cash	—		526		526
Accounts receivable	21,358		220		21,578
Goodwill	107,643		18,453		126,096
Acquired identifiable intangibles:
Customer relationships	241,738		8,608		250,346
Trade names and trademarks	1,623		—		1,623
Other assets	18,720		(11,668)		7,052
Total assets	1,309,645		(5,572)		1,304,073
Liabilities
Accounts payable and accrued expenses	30,905		12,598		43,503
Notes payable	17,179		(13,301)		3,878
Operating lease obligations	1,254		—		1,254
Unearned revenue	3,536		—		3,536
Pension and postretirement benefits	2,020		(2,020)		—
Deferred tax liability	9,063		(39)		9,024

Total liabilities	63,957		(2,762)		61,195
Total consideration for Cloverleaf acquisition	$	1,245,688	$	(2,810)	$	1,242,878

(1) The adjustments recorded during the measurement period did not have a significant impact on our Condensed Consolidated Financial Statements for the nine months ended September 30, 2020. The measurement period ended one year after the Cloverleaf Acquisition, on April 30, 2020.

(2) The measurement period adjustments were primarily due to refinements to third party appraisals and refinements in carrying amounts of certain assets and liabilities, as well as adjustments to certain tax accounts based on, among other things, adjustments to deferred tax liabilities. The net impact of the measurement period adjustments results in a net increase to goodwill.

Business Acquisition, Pro Forma Information

The unaudited pro forma financial information set forth below is based on the historical Condensed Consolidated Statements of Operations for the quarter ended September 30, 2019, adjusted to give effect to the Cloverleaf Acquisition as if it had occurred on January 1, 2019. The pro forma adjustments primarily relate to acquisition expenses, depreciation expense on acquired assets, amortization of acquired intangibles, and estimated interest expense related to financing transactions, the proceeds of which were used to fund the acquisition of Cloverleaf.

On March 1, 2019, Cloverleaf acquired Zero Mountain, Inc. and Subsidiaries (Zero Mountain). As a result, we have included the results of operations of Zero Mountain in the below pro forma financial information. The pro forma adjustments made include the acquisition expenses incurred in connection with Cloverleaf’s acquisition of Zero Mountain.

The accompanying unaudited pro forma consolidated financial statements exclude the results of all other acquisitions completed during 2019 and 2020, which were deemed immaterial. These statements are provided for illustrative purposes only and do not purport to represent what the actual Consolidated Statements of Operations of the Company would have been had the Cloverleaf Acquisition occurred on the dates assumed, nor are they necessarily indicative of what the results of operations would be for any future periods.


Pro forma (unaudited)
(in thousands, except per share data)
	Three Months Ended		Nine Months Ended
	September 30, 2019
Total revenue	$	466,182	$	1,373,281
Net income available to common shareholders(1)	$	27,874	$	36,296
Net income per share, diluted(2)	$	0.14	$	0.18

(1) Pro forma net income available to common shareholders was adjusted to exclude $0.8 million and $26.5 million of acquisition related costs incurred by the Company during the three and nine months ended September 30, 2019.

(2)Adjusted to give effect to the issuance of approximately 42.1 million common shares in connection with the Cloverleaf Acquisition.