XML 46 R23.htm IDEA: XBRL DOCUMENT v3.24.3
Acquisitions (Tables)
 9 Months Ended
Sep. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]  
Schedule of Business Acquisitions, by Acquisition
The table below presents the estimated purchase price (in thousands):
Base purchase price:$230,000 
Less: closing net working capital (as defined in the H2O Midstream Purchase Agreement)
(2,508)
Plus: various closing adjustments
2,003 
Adjusted purchase price$229,495 
Cash paid $159,495 
Fair value of preferred units issued70,000 
Preliminary purchase price$229,495 
(1) These amounts are based upon estimates at closing, but are subject to a subsequent review and revision period pursuant to the H2O Midstream Acquisition agreement at which time final settlements for these components will be determined. Such subsequent adjustments may result in changes to the preliminary purchase price.
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed
The following table summarizes the preliminary fair values of assets acquired and liabilities assumed in the H2O Midstream Acquisition as of September 11, 2024 (in thousands):
Assets acquired:
Accounts receivables6,643 
Inventories2,448 
Other current assets879 
Property, plant and equipment174,548 
Operating lease right-of-use assets470 
Customer relationship intangible(1)
24,006 
Other intangibles(1)
34,841 
Other non-current assets21 
Total assets acquired$243,856 
Liabilities assumed:
Accounts payable$3,954 
Accrued expenses and other current liabilities5,059 
Current portion of operating lease liabilities278 
Asset retirement obligations4,851 
Operating lease liabilities, net of current portion219 
Total liabilities assumed14,361 
Fair value of net assets acquired$229,495 
(1)The acquired intangible assets include the following identified intangibles:
•Rights-of-way intangibles valued at $30.1 million, of which, the majority has an indefinite life.
•Favorable supply contract intangible that is subject to amortization with a preliminary fair value of $4.8 million which will be amortized over a 4.8 years useful life. The estimated amortization is $1.0 million for each of the next four fiscal years, and $0.4 million in the fifth succeeding fiscal year.
•The Customer relationship intangible that is subject to amortization with a preliminary fair value of $24.0 million, which will be amortized over an 12.6 years useful life. The estimated amortization is $1.9 million for each of the five succeeding fiscal years.
Business Acquisition, Pro Forma Information
The following table summarizes the unaudited pro forma financial information of the Partnership assuming the H2O Midstream Acquisition had occurred on January 1, 2023. The unaudited pro forma financial information has been adjusted to give effect to certain pro forma adjustments that are directly related to this acquisition based on available information and certain assumptions that management believes are factually supportable. The most significant pro forma adjustments relate to (i) incremental interest expense associated with revolving credit facility borrowings incurred in connection with this acquisition, (ii) incremental depreciation resulting from the estimated fair values of acquired property, plant and equipment, (iii) incremental amortization resulting from the estimated fair value of the acquired customer relationship intangible and, (iv) transaction costs. The unaudited pro forma financial information excludes any expected cost savings or other synergies as a result of this acquisition. The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have been achieved had this acquisition been effective as of the date presented, nor is it indicative of future operating results of the combined company. Actual results may differ significantly from the unaudited pro forma financial information.
Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
(in thousands)
Net sales$226,303 $296,752 $775,369 $833,859 
Net income attributable to partners$40,045 $40,290 $119,183 $120,856