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Acquisitions | 12 Months Ended
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Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract] |
Acquisitions | Acquisitions Washington Acquisition On November 26, 2018, we entered into a Purchase and Sale Agreement to acquire U.S. Oil & Refining Co. and certain affiliated entities (collectively, “U.S. Oil”), a privately-held downstream business (the “Washington Acquisition”). The Washington Acquisition included a 42 Mbpd refinery, a marine terminal, a unit train-capable rail loading terminal, and 2.9 MMbbls of refined product and crude oil storage. The refinery and associated logistics system are strategically located in Tacoma, Washington, and currently serve the Pacific Northwest market. On January 11, 2019, we completed the Washington Acquisition for a total purchase price of $326.5 million, including acquired working capital, consisting of cash consideration of $289.5 million and approximately 2.4 million shares of Par’s common stock with a fair value of $37.0 million issued to the seller of U.S. Oil. The cash consideration was funded in part through cash on hand, proceeds from borrowings under a new term loan facility entered into with Goldman Sachs Bank USA, as administrative agent, of $250.0 million (the “Term Loan B”), and proceeds from borrowings under a term loan from the Bank of Hawaii of $45.0 million (the “Par Pacific Term Loan”). Please read Note 13—Debt for further information on the Term Loan B and Par Pacific Term Loan. During December 2018 and January 2019, we incurred $4.2 million and $5.4 million of commitment fees associated with the funding of the Washington Acquisition, respectively. Such commitment fees are presented as Debt extinguishment and commitment costs on our consolidated statements of operations for the years ended December 31, 2019 and 2018. In connection with the consummation of the Washington Acquisition, we assumed the Washington Refinery Intermediation Agreement with MLC that provides a structured financing arrangement based on U.S. Oil’s crude oil and refined products inventories and associated accounts receivable. Please read Note 11—Inventory Financing Agreements for further information on the Washington Refinery Intermediation Agreement. We accounted for the Washington Acquisition as a business combination whereby the purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values on the date of the acquisition. Goodwill recognized in the transaction was attributable to opportunities expected to arise from combining our operations with those of the Washington refinery and the utilization of our net operating loss carryforwards, as well as other intangible assets that do not qualify for separate recognition. Goodwill recognized as a result of the Washington Acquisition is not expected to be deductible for income tax reporting purposes. A summary of the fair value of the assets acquired and liabilities assumed is as follows (in thousands):
Cash | $ | 16,146 |
Accounts receivable | 34,954 |
Inventories | 98,367 |
Prepaid and other assets | 5,320 |
Property, plant, and equipment | 412,766 |
Operating lease right-of-use assets | 62,337 |
Goodwill (1) | 42,522 |
Total assets (2) | 672,412 |
Obligations under inventory financing agreements | (116,873) |
Accounts payable | (55,357) |
Current operating lease liabilities | (21,571) |
Other current liabilities | (18,411) |
Long-term operating lease liabilities | (40,766) |
Deferred tax liability | (92,103) |
Other non-current liabilities | (804) |
Total liabilities | (345,885) |
Total | $ | 326,527 |
______________________________________________ (1)We allocated $24.7 million and $17.8 million of goodwill to our refining and logistics segments, respectively. (2)We allocated $403.9 million and $268.5 million of total assets to our refining and logistics segments, respectively. As of December 31, 2019, we finalized the Washington Acquisition purchase price allocation. We incurred $2.2 million and $2.6 million of acquisition costs related to the Washington Acquisition for the years ended December 31, 2019 and 2018, respectively. These costs are included in Acquisition and integration costs on our consolidated statements of operations. The results of operations of U.S. Oil were included in our results beginning on January 11, 2019. For the year ended December 31, 2019, our results of operations included revenues of $1.2 billion and income before income taxes of $65.8 million related to U.S. Oil. The following unaudited pro forma financial information presents our consolidated revenues and net income (loss) as if the Washington Acquisition had been completed on January 1, 2018 (in thousands except per share information):
|  |  |  | Year Ended December 31,
|  |  |  |  |  | 2019 |  | 2018
Revenues |  |  |  |  |  | $ | 5,429,530 |  |  | $ | 4,709,850 |
Net income (loss) |  |  |  |  |  | (4,547) |  |  | 88,174 |
Income (loss) per share |  |  |  |  |  |  |  |
Basic |  |  |  |  |  | $ | (0.09) |  |  | $ | 1.81 |
Diluted |  |  |  |  |  | $ | (0.09) |  |  | $ | 1.79 |
These pro forma results were based on estimates and assumptions that we believe are reasonable. They are not necessarily indicative of our consolidated results of operations in future periods or the results that actually would have been realized had we been a combined company during the periods presented. The pro forma results for the years ended December 31, 2019 and 2018, include adjustments to remeasure U.S. Oil’s LIFO inventory reserve as if the Washington Acquisition had been completed on January 1, 2018, record interest and other debt extinguishment costs related to issuance of the Term Loan B and Par Pacific Term Loan, and adjust U.S. Oil’s historical depreciation expense as a result of the fair value adjustment to Property, plant, and equipment, net. The pro forma results for the year ended December 31, 2019 also include an adjustment to eliminate the $64.2 million tax benefit associated with a partial release of our valuation allowance in connection with the Washington Acquisition.

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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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