Fair value of financial instruments (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of Financial Liabilities Measured at Fair Value on a Recurring Basis

The following table presents our fair value hierarchy for our financial liabilities measured at fair value on a recurring basis as of June 30, 2018 ($ in thousands):



	June 30, 2018		Level 1		Level 2		Level 3
Fair value measurements on a recurring basis:
Interest rate swap	$	3,720	$	—	$	3,720	$	—

Reconciliation of Level 3 Fair Valued Instruments

The following table presents the changes in our Level 3 fair valued instruments for the three and six months ended June 30, 2017 ($ in thousands):



	Deferred Consideration
Balance as of December 31, 2016	$	1,836
Total gains included in earnings (or change in net assets) ⁽¹⁾	(26		)
Settlements	(630		)
Balance as of March 31, 2017	$	1,180
Total losses included in earnings (or change in net assets) ⁽¹⁾	675
Settlements	(735		)
Balance as of June 30, 2017	$	1,120

________

⁽¹⁾ All losses and gains (other than changes in net assets) were included in interest expense in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Schedule of Financial Liabilities Not Measured at Fair Value

The following tables present our fair value hierarchy for our financial liabilities not measured at fair value as of June 30, 2018 and December 31, 2017 ($ in thousands):



	Carrying Value		Fair Value
	As of June 30, 2018		Level 1		Level 2		Level 3
Financial liabilities not recorded at fair value:
Debt:
Term Loan	$	993,741	$	—	$	—	$	993,962
Revolving Credit Facility	—		—		—		—
Total	$	993,741	$	—	$	—	$	993,962



	Carrying Value		Fair Value
	As of December 31, 2017		Level 1		Level 2		Level 3
Financial liabilities not recorded at fair value:
Debt:
Term Loan	$	898,215	$	—	$	—	$	916,369
Revolving Credit Facility	—		—		—		—
Total	$	898,215	$	—	$	—	$	916,369

Summary of Valuation Techniques

The following table summarizes the valuation techniques used to estimate the fair value of our financial liabilities measured at fair value on a recurring basis and our financial liabilities not measured at fair value:



		Valuation Technique
Financial liabilities recorded at fair value:
Interest rate swaps		The fair value of the interest rate swaps is estimated based on the expected future cash flows by incorporating the notional amount of the swaps, the contractual period to maturity, and observable market-based inputs, including interest rate curves. The fair value also incorporates credit valuation adjustments to appropriately reflect nonperformance risk.
Financial liabilities not recorded at fair value:
Term Loan		The fair value of our Term Loan is estimated using cash flow projections over the remaining contractual period by applying market forward rates and discounting back at the appropriate discount rate.
Revolving Credit Facility		The valuation technique of our Revolving Credit Facility is consistent with our Term Loan. The fair value of the Revolving Credit Facility generally approximates its carrying value as the expected term is significantly shorter in duration.