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Acquisitions | 3 Months Ended
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Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract] |
Acquisitions | Note 5 — Acquisitions Mountaineer Acquisition On September 1, 2021, UGI completed the Mountaineer Acquisition in which UGI acquired all of the equity interests in Mountaineer, the largest natural gas distribution company in West Virginia, for a purchase price of $540, including the assumption of $140 principal amounts of long-term debt. The Mountaineer Acquisition was consummated pursuant to a purchase and sale agreement between UGI and the iCON Sellers and is consistent with our growth strategies, including expanding our core utility operations in the mid-Atlantic region. The Mountaineer Acquisition was funded with cash proceeds from the UGI Corporation Senior Credit Facility $215 term loan and cash on hand including proceeds from the issuance of Equity Units. Accounts associated with Mountaineer are included within our Utilities reportable segment. The Company has accounted for the Mountaineer Acquisition using the acquisition method. During the three months ended December 31, 2021, the Company recorded an adjustment to decrease goodwill by $5 primarily reflecting an adjustment to a valuation allowance on certain deferred income taxes. At December 31, 2021, the allocation of the purchase price is complete except for the finalization of the evaluation of certain regulatory assets. The purchase price allocation will be finalized once this item has been resolved. Accordingly, the fair value estimates presented below relating to this item, which is included in “Other current assets” below, is subject to change within the measurement period not to exceed one year from the date of acquisition. The components of the preliminary Mountaineer purchase price allocations are as follows:
Assets acquired: |
Cash and cash equivalents | $ | 3 |
Accounts receivable | 14 |
Inventories | 41 |
Other current assets | 21 |
Property, plant and equipment | 397 |
Other noncurrent assets | 48 |
Total assets acquired | $ | 524 |
Liabilities assumed: |
Short-term borrowings | $ | 55 |
Accounts payable | 20 |
Other current liabilities | 52 |
Long-term debt | 164 |
Pension and other postretirement benefit obligation | 33 |
Deferred income taxes | 21 |
Other noncurrent liabilities | 29 |
Total liabilities assumed | $ | 374 |
Goodwill | 250 |
Net consideration transferred | $ | 400 |
Mountaineer is a regulated entity which accounts for the financial effects of regulation in accordance with ASC 980. The effects of regulation can impact the fair value of certain assets and liabilities acquired, and as such, the measurement of the fair value of regulated property assets using the predecessor’s carrying value is generally accepted since regulation attaches to the assets and regulation is so pervasive that the regulation extends to the individual assets. In certain other instances where assets or liabilities are subject to rate recovery, we recorded fair value adjustments to such assets and liabilities as regulatory assets and liabilities. The excess of the purchase price for the Mountaineer Acquisition over the fair values of the assets acquired and liabilities assumed has been reflected as goodwill, assigned to the Utilities reportable segment. Goodwill is attributable to the assembled workforce of Mountaineer, planned customer growth and planned growth in rate base through continued investment in utility infrastructure. The goodwill recognized from the Mountaineer Acquisition is not expected to be deductible for income tax purposes. The impact of the Mountaineer Acquisition on a pro forma basis as if the Mountaineer Acquisition had occurred on October 1, 2020 was not material to the Company’s revenues or net income for the three months ended December 31, 2020.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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