XML 32 R20.htm IDEA: XBRL DOCUMENT
v3.21.2

Acquisitions | 9 Months Ended
--- | ---
Sep. 30, 2021
Business Combinations [Abstract] |
Acquisitions | 13. Acquisitions For the nine months ended September 30, 2021, the Company completed two acquisitions for an aggregate purchase price consideration of approximately $119 million. The aggregate purchase price was comprised of $96 million of cash, subject to working capital adjustments, and an estimated $23 million of contingent consideration if certain financial and profitability thresholds are achieved following the closing of the transactions. The acquisition date fair value of contingent consideration was approximately $19 million in other current liabilities and approximately $4 million in other long-term liabilities in the consolidated balance sheets. These acquisitions primarily expanded the Company’s offering in the U.S. to provide the rental, sale and service of surface-mounted horizontal pumping systems and horizontal jet pumping systems, as well as, to provide engineering and construction services. The Company has included the financial results of the acquisitions in its consolidated financial statements from the date of each acquisition. The fair value of acquisition-related contingent consideration liabilities was determined using the Monte Carlo simulation based on the Company's estimated future cash flow projections, the probability of achievement and the estimated discount rates, all of which were classified as level 3 inputs under the fair value hierarchy. One acquisition has a maximum contingent payment of approximately $6 million based on a 3.25-year earn-out period. The other acquisition has no maximum payment based on a 1-year earn-out period for which the undiscounted estimated range of outcomes was $0 to $45 million and the estimated fair value used a discount rate of 14.0% as of September 30, 2021. Changes in business conditions or other events could significantly change the level 3 inputs, and therefore could result in material changes to the fair value of the contingent consideration. For the three months ended on September 30, 2021, the increase in the fair value of the contingent consideration liabilities was approximately $1 million which was recorded in other expense in the consolidated statements of operations. In 2021, the Company performed its preliminary valuations as of the applicable acquisition dates of the acquired net assets and recognized estimated goodwill of $66 million and intangible assets of $11 million in the U.S. segment, which are subject to change. If additional information is obtained about these assets and liabilities within the measurement period (not to exceed one year from the date of acquisition), through physical asset inspections and learning more about the newly acquired businesses, the Company will refine its estimate of fair value to allocate the purchase price more accurately. The following table summarizes the purchase price allocation detail (in millions):
|  | As of September 30, 2021 |
Consideration transferred: |  |  |
Cash |  | $ | 96 |
Estimated fair value of contingent consideration |  |  | 23 |
Net purchase price |  | $ | 119 |
Fair value of net assets acquired: |  |  |
Current assets other than cash |  | $ | 8 |
Property, plant and equipment |  |  | 36 |
Customer relationships and other intangibles (1) |  |  | 11 |
Other assets and liabilities, net |  |  | (2 | )
Total fair value of net assets acquired |  | $ | 53 |
Goodwill (2) |  | $ | 66 |
(1) Intangible assets acquired are amortized over a 9-year weighted average period. (2) The amount of goodwill represents the excess of its purchase price over the fair value of net assets acquired. Goodwill includes the expected benefit that the Company believes will result from combining its operations with those of the businesses acquired. The amount of goodwill expected to be deductible for income tax purposes is approximately $60 million, subject to changes in the fair value of contingent consideration liability subsequent to the acquisition date. The Company has not presented supplemental pro forma information because the acquired operations did not materially impact the Company’s consolidated operating results. One acquisition involved a party with which one of the Company’s former Board of Directors is affiliated. See “Capital Spending” in Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional information. For the nine months ended September 30, 2021, the Company recognized approximately $2 million of acquisition-related costs

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://fasb.org/us-gaap/role/ref/legacyRef -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: | dtr-types: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