Investment in Unconsolidated Subsidiary

9 Months Ended

Sep. 27, 2014

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Subsidiary

Investment in Unconsolidated Subsidiaries

The Company announced on January 21, 2011 that a wholly-owned subsidiary of Darling entered into a limited liability company agreement with a wholly-owned subsidiary of Valero Energy Corporation (“Valero”) to form Diamond Green Diesel Holdings LLC (the “DGD Joint Venture”). The DGD Joint Venture is owned 50% / 50% with Valero and was formed to design, engineer, construct and operate a renewable diesel plant (the “DGD Facility”), which is capable of processing approximately 11,000 barrels per day of input feedstock to produce renewable diesel fuel and certain other co-products, and is located adjacent to Valero's refinery in Norco, Louisiana. The DGD Joint Venture reached mechanical completion and began the production of renewable diesel in late June 2013. On August 3, 2014, the facility shutdown as a result of a fire incident. The facility resumed operations on September 18, 2014. The DGD Joint Venture anticipates that the fire incident will be covered under its property and casualty insurance policies and the financial exposure is limited to the deductible. The DGD Joint Venture does not expect to file a business interruption claim.

On May 31, 2011, the DGD Joint Venture and Diamond Green Diesel LLC, a wholly-owned subsidiary of the DGD Joint Venture (“Opco”), entered into (i) a facility agreement (the “Facility Agreement”) with Diamond Alternative Energy, LLC, a wholly-owned subsidiary of Valero (the “Lender”), and (ii) a loan agreement (the “Loan Agreement”) with the Lender, which provided the DGD Joint Venture with a 14 year multiple advance term loan facility of approximately $221,300,000 (the “JV Loan”) to support the design, engineering and construction of the DGD Facility, which is now in production. The Facility Agreement and the Loan Agreement prohibit the Lender from assigning all or any portion of the Facility Agreement or the Loan Agreement to unaffiliated third parties. Opco has also pledged substantially all of its assets to the Lender, and the DGD Joint Venture has pledged all of Opco's equity interests to the Lender, until the JV Loan has been paid in full and the JV Loan has terminated in accordance with its terms.

In addition to the DGD Joint Venture, the Company has investments in other unconsolidated subsidiaries that were acquired in the VION Acquisition that are insignificant to the Company. Selected financial information for the Company's DGD Joint Venture is as follows (in thousands):

				Three Months Ended					Three Months Ended
As of December 31, 2013				September 30, 2014					September 30, 2013
Total Assets		Members' Equity		Revenues		Net Loss			Revenues		Net Income
$	488,435	$	230,228	$	80,206	$	(2,962	)	$	96,475	$	23,907
				Nine Months Ended					Nine Months Ended
As of September 30, 2014				September 30,2014					September 30, 2013
Total Assets		Members' Equity		Revenues		Net Income			Revenues		Net Income
$	481,954	$	239,573	$	347,926	$	9,344		$	96,517	$	17,593

As of September 27, 2014 under the equity method of accounting, the Company has an investment in the DGD Joint Venture of approximately $119.8 million on the consolidated balance sheet and has recorded approximately $4.7 million of income and $8.8 million of income in the unconsolidated subsidiary for the nine months ended September 27, 2014 and September 28, 2013, respectively.