XML 34 R10.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Acquisitions | 12 Months Ended
--- | ---
Dec. 31, 2017
Business Combinations [Abstract] |
Acquisitions | Acquisitions Alkali Business On September 1, 2017, we acquired our Alkali Business for approximately $1.325 billion (inclusive of approximately $105 million in working capital). Our Alkali Business mines and processes trona from which it produces natural soda ash, also known as sodium carbonate (Na 2 CO 3), as basic building block for a number of ubiquitous products, including flat glass, container glass, dry detergent and a variety of chemicals and other industrial products. To finance that transaction and the related costs, we used proceeds from (i) a $550 million public offering of 6.50% senior unsecured notes due 2025 in August 2017, generating net proceeds of $540.1 million after issuance and underwriting fees, (ii) a $750 million private placement of Class A Convertible Preferred units in September 2017, generating net proceeds of $726.4 million, (iii) borrowings under our revolving credit facility and (iv) cash on hand. We have reflected the financial results of our Alkali Business in our sodium minerals and sulfur services segment from the date of acquisition. The purchase price has been allocated to the assets acquired and liabilities assumed based on estimated preliminary fair values. Those preliminary fair values were developed by management with the assistance of a third-party valuation firm and are subject to change pending a final valuation report and final determination of any other purchase price adjustments. Certain changes were made in our preliminary purchase price allocation at December 31, 2017, as compared to what we had previously disclosed in our third quarter 2017 Form 10-Q. These changes principally relate to reclassifications made between mineral leaseholds and fixed assets as a result of further progress in our valuation process. We expect to finalize the purchase price allocation for this transaction during the first half of 2018. The preliminary allocation of the purchase price, as presented on our Consolidated Balance Sheet, is summarized as follows:
Accounts receivable | 138,258 |
Inventories | 34,929 |
Other current assets | 13,254 |
Fixed assets | 663,217 |
Mineral leaseholds | 566,019 |
Intangible assets | 800 |
Other assets | 3,612 |
Accounts payable | (44,547 | )
Accrued Liabilities | (36,884 | )
Other long-term liabilities | (13,658 | )
Total Purchase Price | $ | 1,325,000 |
Fixed assets identified in connection with our valuation and preliminary purchase price allocation include the related facilities, machinery and equipment associated with our Alkali Business, principally at our Green River, Wyoming operations. These assets will be depreciated under the straight line method and have useful lives ranging from 2 to 30 years. Mineral leaseholds include the trona reserves at our Green River, Wyoming facility and are depleted over their useful lives as determined by the units of production method. Other long-term liabilities contains various items including assumed employee benefit plan obligations. Other items principally consist of working capital items of our Alkali Business as acquired on September 1, 2017. Our Consolidated Financial Statements include the results of our Alkali Business since September 1, 2017, the closing date of the acquisition. The following table presents selected financial information included in our Consolidated Financial Statements for the periods presented:
| Year Ended December 31,
| 2017
Revenues | 277,011 |
Net income | 42,014 |
The table below presents selected unaudited pro forma financial information incorporating the historical results of our Alkali Business. The pro forma financial information below has been prepared as if the acquisition had been completed on January 1, 2015 and is based upon assumptions deemed appropriate by us and may not be indicative of actual results. This pro forma information was prepared using historical financial data of our trona and trona-based exploring, mining, processing, producing, marketing and selling business and reflects certain estimates and assumptions made by our management. Our unaudited pro forma financial information is not necessarily indicative of what our consolidated financial results would have been had our Alkali Business acquisition been completed on January 1, 2015. Pro forma net income includes the effects of distributions on preferred units and interest expense on incremental borrowings. The dilutive effect of Class A Preferred Units is calculated using the if-converted method.
| Year Ended December 31,
| 2017 |  | 2016 |  | 2015
Pro forma consolidated financial operating results: |  |  |  |  |
Revenues | $ | 2,549,438 |  |  | $ | 2,498,293 |  |  | $ | 3,043,529 |
Net Income Attributable to Genesis Energy, L.P. | 84,010 |  |  | 120,515 |  |  | 416,118 |
Net Income Available to Common Unitholders | 18,953 |  |  | 57,057 |  |  | 351,436 |
Basic and diluted earnings per common unit: |  |  |  |  |
As reported net income per common unit | $ | 0.50 |  |  | $ | 1.00 |  |  | $ | 4.10 |
Pro forma net income per common unit, basic | $ | 0.16 |  |  | $ | 0.50 |  |  | $ | 3.41 |
Pro forma net income per common unit, dilutive | $ | 0.16 |  |  | $ | 0.50 |  |  | $ | 3.33 |
As relating to our Alkali Business acquisition, we have incurred approximately $12.0 million in acquisition related costs through December 31, 2017. Such costs are included as "General and Administrative costs" on our Consolidated Statement of Operations. Enterprise Offshore On July 24, 2015, we acquired the offshore pipeline and services business of Enterprise Products Partners, L.P. and its affiliates for approximately $1.5 billion, subject to certain adjustments. That business includes interests in offshore crude oil and natural gas pipelines and six offshore hub platforms, including a 36% interest in the Poseidon Oil Pipeline System, a 50% interest in the Southeast Keathley Canyon Oil Pipeline System, and a 50% interest in the Cameron Highway Oil Pipeline System. To finance that transaction, in July 2015, we issued 10,350,000 common units in a public offering that generated proceeds of $437.2 million net of underwriter discounts and $750 million aggregate principal amount of 6.75% senior unsecured notes due 2022 that generated net proceeds of $728.6 million net of issuance discount and underwriting fees. The remainder of that transaction was financed with borrowings under our senior secured credit facility. We have reflected the financial results of the acquired business in our offshore pipeline transportation segment from the date of acquisition. The purchase price has been allocated to the assets acquired and liabilities assumed based on estimated preliminary fair values. Those fair values were developed by management with the assistance of a third-party valuation firm. The purchase price allocation for this transaction has been finalized. Our finalized purchase price allocation remains unchanged from what was disclosed in the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2016. The allocation of the purchase price, as presented on our Consolidated Balance Sheet, is summarized as follows:
Cash | $ | 1,270 |
Accounts receivable | 29,768 |
Inventories | 600 |
Other current assets | 10,432 |
Fixed assets | 1,225,685 |
Intangible assets | 79,050 |
Equity investees | 352,535 |
Other assets | 1,966 |
Accounts payable | (6,110 | )
Accrued liabilities | (18,662 | )
Other long-term liabilities | (161,412 | )
Noncontrolling interest | 6,447 |
Total purchase price | $ | 1,521,569 |
Fixed assets identified in connection with our valuation and purchase price allocation includes crude oil pipelines, natural gas pipelines and related assets. We will depreciate these assets on a straight line basis over estimated useful lives ranging from 2 to 35 years depending on the nature of each asset. Intangible assets identified in connection with our valuation and purchase price allocation relate to customer contracts surrounding certain transportation agreements with producers in the Lucius production area in Southeast Keathley Canyon, which support our SEKCO pipeline. We will amortize these intangible assets on a straight line basis over an estimated useful life of 19 years. In connection with our valuation and purchase price allocation, we have identified asset retirement obligations ("AROs") relating to the crude oil pipelines, natural gas pipelines and related assets with a preliminary fair value of $158.2 million. Of these AROs, $9.8 million of retirement costs were estimated to be incurred within the next year and thus were included in accrued liabilities in the table above, as well as on our Consolidated Balance Sheet at December 31, 2015. The remainder of the AROs recorded as a result of our Enterprise acquisition are included within "Other long-term liabilities" in the table above, as well as on our Consolidated Balance Sheet. See further discussion of AROs assumed as a result of our Enterprise acquisition in Note 6. Noncontrolling interest as shown in the table above relates to the fair value assigned to the 20% ownership interest of our joint venture partner in Independence Hub, LLC, a consolidated subsidiary acquired as a result of our Enterprise acquisition in which we have an 80% ownership interest. Our Consolidated Financial Statements include the results of our acquired offshore pipeline transportation business since July 24, 2015, the effective closing date of the acquisition. The following table presents selected financial information included in our Consolidated Financial Statements for the periods presented:
| Year Ended December 31,
| 2015
Revenues | $ | 101,444 |
Net income | $ | 58,805 |
The table below presents selected unaudited pro forma financial information incorporating the historical results of our newly acquired offshore pipeline transportation assets. The pro forma financial information below has been prepared as if the acquisition had been completed on January 1, 2015 and is based upon assumptions deemed appropriate by us and may not be indicative of actual results. This pro forma information was prepared using historical financial data of the Enterprise offshore pipelines and services businesses and reflects certain estimates and assumptions made by our management. Our unaudited pro forma financial information is not necessarily indicative of what our consolidated financial results would have been had our Enterprise acquisition been completed on January 1, 2015.
| Year Ended December 31,
Pro forma consolidated financial operating results: | 2015
Revenues | $ | 2,421,989 |
Net Income Attributable to Genesis Energy L.P. | $ | 425,363 |
Basic and diluted earnings per unit: |
As reported net income per unit | $ | 4.09 |
Pro forma net income per unit | $ | 3.91 |
As relating to our Enterprise acquisition, we incurred approximately $15 million in acquisition related costs through December 31, 2015 and incurred an additional $1 million during the year ended December 31, 2016. Such costs are included as "General and Administrative costs" on our Unaudited Condensed Consolidated Statement of Operations.

X
- 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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration