Acquisition

9 Months Ended

Sep. 30, 2023

Business Combination and Asset Acquisition [Abstract]

(3) Acquisition

Central Oklahoma Acquisition

On December 19, 2022, we completed the Central Oklahoma Acquisition. The acquired assets include approximately 900 miles of lean and rich gas gathering pipeline and two processing plants with 280 MMcf/d of total processing capacity. We completed this acquisition to increase the scale and efficiency of our Central Oklahoma assets.

The following table presents the fair value of the identified assets received and liabilities assumed at the acquisition date (in millions):


Consideration
Cash (including working capital payment)	$	100.9
Contingent consideration	1.3
Total consideration	$	102.2

Purchase price allocation
Assets acquired:
Current assets	$	6.0
Property and equipment	97.1
Other assets, net (1)	0.9
Liabilities assumed:
Current liabilities	(1.4)
Other long-term liabilities (1)	(0.4)
Net assets acquired	$	102.2

____________________________

(1)“Other assets, net” and “Other long-term liabilities” consist of the right-of-use assets and lease liabilities, respectively, obtained through the Central Oklahoma Acquisition.

Contingent Consideration. The following table represents our change in carrying value of the Amarillo Rattler Acquisition and Central Oklahoma Acquisition contingent consideration liabilities for the periods presented (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amarillo Rattler Acquisition contingent consideration
Contingent consideration liability, beginning of period (1)	$	4.6	$	7.2	$	4.2	$	6.9
Change in fair value	0.4		(2.8)		0.8		(2.5)
Contingent consideration liability, end of period	$	5.0	$	4.4	$	5.0	$	4.4

Central Oklahoma Acquisition contingent consideration
Contingent consideration liability, beginning of period (2)	$	1.8	$	—	$	1.3	$	—
Change in fair value	(0.1)		—		0.4		—
Contingent consideration liability, end of period	$	1.7	$	—	$	1.7	$	—

Total contingent consideration
Contingent consideration liability, beginning of period (1)(2)	$	6.4	$	7.2	$	5.5	$	6.9
Change in fair value	0.3		(2.8)		1.2		(2.5)
Contingent consideration liability, end of period	$	6.7	$	4.4	$	6.7	$	4.4

____________________________

(1)The contingent consideration for the Amarillo Rattler Acquisition was recorded on April 30, 2021.

(2)The contingent consideration for the Central Oklahoma Acquisition was recorded on December 19, 2022.

Pro Forma of Acquisitions for the Three and Nine Months Ended September 30, 2022

The following unaudited pro forma condensed consolidated financial information (in millions) for the three and nine months ended September 30, 2022 gives effect to the Barnett Shale Acquisition on July 1, 2022 and the Central Oklahoma Acquisition on December 19, 2022 as if each of the acquisitions had occurred on January 1, 2022.

The unaudited pro forma condensed consolidated financial information has been included for comparative purposes only and is not necessarily indicative of the results that might have occurred had the transactions taken place on the dates indicated and is not intended to be a projection of future results.


	Three Months Ended September 30, 2022		Nine Months Ended September 30, 2022
Pro forma total revenues	$	2,677.2	$	7,569.6
Pro forma net income	$	121.8	$	336.2