Acquisitions

3 Months Ended

Mar. 31, 2022

Business Combination and Asset Acquisition [Abstract]

Acquisitions

ACQUISITIONS

On December 30, 2021, the Company acquired 100% of the stock of Amber Resources. Amber Resources is one of the leading full-service petroleum distributors and providers in Southern California, offering a broad product line of fuel, lubricants and diesel exhaust fluid ("DEF") solutions via highly differentiated, service-oriented model. Amber Resources is consolidated into REG in accordance with ASC 805, Business Combinations and is part of the Bio-based Diesel Reportable Segment. The Company completed its preliminary accounting of this business combination as the valuation of the acquired assets and assumed liabilities, including a tax reserve, was not finalized as of the date of this report. The consideration for the acquisition of Amber Resources, after adjusting for net working capital items allowed under the purchase agreement, was $78,434.

The Company used the income approach to value certain intangible assets. Under the income approach, an intangible asset’s fair value is equal to the present value of future economic benefits to be derived from ownership of the asset. The Company used the income approach known as the relief from royalty method to value the fair value of the trade names. The relief from royalty method is based on the hypothetical royalty stream that would be received if we were to license the trade name and was based on expected revenues. The determination of the fair value of other assets acquired and liabilities assumed involves assessing factors such as the expected future cash flows associated with individual assets and liabilities and appropriate discount rates at the date of the acquisition.

The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date.

	December 30, 2021
Assets (liabilities) acquired of Amber Resources:
Cash	$	5,643
Accounts receivable (net of allowance for doubtful accounts)	15,502
Inventory	8,830
Other current assets	4,558
Property, plant and equipment	16,248
Right of use assets	15,773
Intangibles	45,000
Goodwill	23,986
Other assets	4,023
Total assets acquired	139,563
Accounts payable	20,467
Accrued expenses and other liabilities	9,495
Current maturities of operating lease obligations	1,528
Other liabilities	2,625
Deferred income taxes	12,600
Long-term operating lease obligations	14,414
Total liabilities acquired	$	61,129