ACQUISITIONS AND DISPOSITION

Gatherco Acquisition

On April 1, 2015, we completed the merger with Gatherco, in which Gatherco merged with and into Aspire Energy, our then newly formed, wholly-owned subsidiary. Aspire Energy is an unregulated natural gas infrastructure company with approximately 2,500 miles of pipeline systems in 40 counties throughout Ohio. The majority of Aspire Energy’s margin is derived from long-term supply agreements with Columbia Gas of Ohio and Consumers Gas Cooperative which together serve more than 20,000 end-use customers. Aspire Energy primarily sources gas from 300 conventional producers and provides gathering and processing services necessary to maintain quality and reliability to its wholesale markets.

At closing, we issued 592,970 shares of our common stock, valued at $30.2 million based on the closing price of our common stock as reported on the NYSE on April 1, 2015. In addition, we paid $27.5 million in cash and assumed $1.7 million of existing outstanding debt, which we paid off on the same date. We also acquired $6.8 million of cash on hand at closing.



(in thousands)	Net Purchase Price
Chesapeake Utilities common stock issued	$	30,164
Cash	27,494
Acquired debt	1,696
Aggregate amount paid in the acquisition	59,354
Less: cash acquired	(6,806		)
Net amount paid in the acquisition	$	52,548

The merger agreement provides for additional contingent cash consideration to Gatherco's shareholders of up to $15.0 million based on a percentage of revenue generated from potential new gathering opportunities over the next five years.

We incurred $1.3 million in transaction costs associated with this merger, $514,000 of which was expensed during the year ended December 31, 2015. Transaction costs are included in operations expense in the accompanying consolidated statements of income. The revenue and net income from this acquisition for the year ended December 31, 2015, included in our consolidated statements of income, were $16.7 million and $312,000, respectively. The 2015 financial results of Aspire Energy have had a minimal impact on our earnings per share in 2015, because the merger was completed after the first quarter of 2015, and Ohio experienced warmer than normal weather during the fourth quarter of 2015. The first and fourth quarters include key winter months, which have historically produced a significant portion of Gatherco's annual earnings. This acquisition is expected to be accretive to our earnings in the first full year of operations, which will include the first quarter of 2016.

The purchase price allocation of the Gatherco acquisition is as follows:



(in thousands)	Purchase Price Allocation
Purchase price	$	57,658

Property plant and equipment	53,202
Cash	6,806
Accounts receivable	3,629
Income taxes receivable	3,012
Other assets	247
Total assets acquired	66,896

Long-term debt	1,696
Deferred income taxes	12,987
Accounts payable	3,837
Other current liabilities	314
Total liabilities assumed	18,834
Net identifiable assets acquired	48,062
Goodwill	$	9,596

The excess of the purchase price over the estimated fair values of the assets acquired and the liabilities assumed was recognized as goodwill at the acquisition date. The goodwill reflects the value paid primarily for opportunities for growth in a new and strategic geographic area. All of the goodwill from this acquisition was recorded in the Unregulated Energy segment and is not expected to be deductible for income tax purposes. We will complete the final purchase price allocation as soon as practicable, but no later than one year from the purchase of the assets.

In December 2015, we adjusted the allocation of the purchase price based on additional information available. The adjustments resulted in a change in the fair value of property, plant and equipment and deferred income tax liabilities. Goodwill from the merger decreased from $11.1 million to $9.6 million after incorporating these adjustments. The valuation of additional contingent cash consideration may be adjusted as additional information becomes available.

Other acquisitions

On May 7, 2015, we purchased certain propane distribution assets from Anderson Gas used to serve 253 customers in Citrus County, Florida for approximately $242,000. In connection with this acquisition, we recorded $186,000 in intangible assets related to a non-compete agreement and the customer list to be amortized over six years and 10 years, respectively. The remaining purchase price was allocated to property, plant and equipment and accounts receivable. The revenue and net income from this acquisition that were included in our consolidated statements of income for the year ended December 31, 2015 were not material.

Disposition of BravePoint

On October 1, 2014, we completed the sale of BravePoint, our former advanced information services subsidiary, for approximately $12.0 million in cash. We reinvested the proceeds from this sale in our regulated and unregulated energy businesses. We recorded a pre-tax gain of $6.7 million (approximately $4.0 million after-tax) from this sale, which included the effect of certain costs and expenses associated with the sale. Our consolidated statements of income for the years ended December 31, 2014 and 2013, included $15.1 million and $19.1 million of revenue, respectively, and $232,000 and $155,000 of net loss, respectively, from BravePoint's operations.