Acquisitions

Tyson Onsite Acquisition

On January 3, 2018, the Company acquired all of the issued and outstanding membership interests of Onsite Space LLC (d/b/a Tyson Onsite (“Tyson”)). Tyson provided modular space rental services in the Midwest, primarily in Indiana, Illinois and Missouri. The Company expects to realize synergies and cost savings related to this acquisition as a result of purchasing and procurement economies of scale and general and administrative expense savings, particularly with respect to the consolidation of corporate related functions and elimination of redundancies. The acquisition date fair value of the consideration transferred consisted of $24.0 million in cash consideration, net of cash acquired. The transaction was fully funded by borrowings under the Asset-Backed Lending (“ABL”) Facility.

As part of the acquisition, $0.2 million of cash was acquired, $20.4 million was attributed to rental fleet and $3.4 million was attributed to goodwill. All goodwill is expected to be deductible for tax purposes. As a result of the timing of the transaction, the purchase price allocation for the rental fleet acquired is based on a preliminary valuation and is subject to change as the Company obtains additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact the Company’s statements of operations in future periods. The Company expects that the preliminary values assigned to the rental fleet and goodwill will be finalized during the one-year measurement period following the acquisition date.

Tyson results were immaterial to the condensed consolidated statements of operations for the three months ended March 31, 2018 and as a result, the Company is not presenting pro-forma information.

Acton Acquisition

On December 20, 2017, WSII acquired 100% of the issued and outstanding ownership interests of Acton Mobile Holdings LLC (“Acton”) for a cash purchase price of $237.1 million, subject to certain adjustments. Acton owns all of the issued and outstanding membership interests of New Acton Mobile Industries, which provided modular space and portable storage rental services across the US. WSII funded the acquisition with cash on hand and borrowings under the ABL Facility. The Company incurred $2.6 million in integration fees associated the Acton acquisition within selling, general, and administrative expenses (“SG&A”) for the three months ended March 31, 2018.

As of March 31, 2018, the Company recorded an adjustment to the Acton opening balance sheet which increased accrued liabilities by $1.0 million due to further evaluation of unindemnified liabilities. This increase resulted in an equal increase in goodwill as detailed in Note 6. As a result of the timing of the transaction, the purchase price allocations for the rental equipment, intangible assets, property, plant and equipment, deferred tax assets, and other accrued tax liabilities acquired and assumed are based on preliminary valuations and are subject to change as the Company obtains additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact the Company’s statements of operations in future periods. The Company expects that the preliminary values assigned to the rental equipment, intangible assets, property, plant and equipment, deferred tax assets, and other accrued tax liabilities will be finalized during the one-year measurement period following the acquisition date.

The pro-forma information below has been prepared using the purchase method of accounting, giving effect to the Acton acquisition as if it had been completed on January 1, 2017 (the “pro-forma acquisition date”). The pro-forma information is not necessarily indicative of the Company’s results of operations had the acquisition been completed on the above date, nor is it necessarily indicative of the Company’s future results. The pro-forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition, and also does not reflect additional revenue opportunities following the acquisition.

The table below presents unaudited pro-forma consolidated statements of operations information as if Acton had been included in the Company’s consolidated results for the three months ended March 31, 2017:



(in thousands)	Three Months Ended March 31, 2017
WSC historic revenues (a)	$	99,321
Acton historic revenues	22,156
Pro-forma revenues	121,477

WSC historic pretax loss (a)	(17,253		)
Acton historic pretax loss	(166		)
Pro-forma pretax loss	(17,419		)
Pro-forma adjustments to combined pretax loss:
Impact of fair value mark-ups/useful life changes on depreciation (b)	(636		)
Intangible asset amortization (c)	(177		)
Interest expense (d)	(2,579		)
Elimination of historic Acton interest (e)	1,178
Pro-forma pretax loss	(19,633		)
Income tax benefit	(5,541		)
Proforma loss from continuing operations	(14,092		)
Income from discontinued operations	2,205
Net loss	$	(11,887	)

(a) Excludes historic revenues and pre-tax income from discontinued operations

(b) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of equipment acquired in

the Acton acquisition. The useful lives assigned to such equipment did not change significantly from the useful lives used by Acton.

(d) In connection with the Acton acquisition, the Company drew $237.1 million on the ABL Facility. As of March 2018, the weighted-

average interest rate of ABL borrowings was 4.35%.

(e) Interest on Acton historic debt was eliminated.