Sale of Business

12 Months Ended

Dec. 31, 2023

Discontinued Operations and Disposal Groups [Abstract]

Grace Disposal Group

On November 15, 2023, the Company sold the Grace Disposal Group to Nan, Inc., an unrelated third party, for total consideration of $57.5 million, which consisted of cash proceeds of $42.5 million and a $15.0 million promissory note. The promissory note had a maturity date of January 5, 2024 and did not accrue interest. The note was paid in full in January 2024. In connection with the sale, the Company recognized a net loss on disposition of $13.2 million for the year ended December 31, 2023, which is presented within Income (loss) from discontinued operations, net of income taxes in the consolidated statements of operations. In addition, the Company was released by Grace Pacific's third-party sureties from all indemnity obligations relating to Grace Pacific's construction bonds (bid, performance and payment bonds). The assets and liabilities associated with the Grace Disposal Group are classified as held for sale in the consolidated balance sheets as of December 31, 2022, and financial results are classified as discontinued operations in the consolidated statements of operations and cash flows for all periods presented.

McBryde Legacy Business

On June 30, 2022, the Company sold to Brue Baukol Capital Partners, an unrelated third party, approximately 18,900 acres of primarily conservation and agricultural land on the island of Kauai and 100% of the Company's ownership interest in McBryde Resources, Inc., the operator of hydroelectric power facilities on Kauai, in exchange for cash proceeds and escrow receivables of $73.9 million and $0.9 million, respectively. In connection with the sale, the Company recognized a net gain of $54.0 million for the year ended December 31, 2022, which is presented within Gain (loss) on disposal of non-core assets, net in the consolidated statements of operations. The disposal was not considered individually significant and does not qualify for presentation and disclosure as a discontinued operation.

Held for Sale and Discontinued Operations

In November 2023, the Company entered into a disposition agreement with an unrelated third party for the sale of Waipouli Town Center, a retail property within our Commercial Real Estate segment. The transaction is structured to qualify under section §1031 of the Code. In order to allow time for the Company to identify suitable replacement property, the Company has up to one year from the agreement execution date to close the transaction, at its option. The Company determined that the property met the criteria to be classified as held for sale as of the agreement execution date of November 15, 2023, but would not be considered discontinued operations as it neither represents a strategic shift, nor will it have a material impact on the Company's operations and financial results. Accordingly, we measured the assets and liabilities associated with the property at fair value less any costs to sell as of December 31, 2023, and recorded impairment of $2.2 million in the fourth quarter of 2023. The impairment charge is presented in Impairment of Assets in the consolidated statements of operations for the year ended December 31, 2023. The assets and liabilities associated with Waipouli Town Center are presented in the consolidated balance sheets as Assets held for sale and Liabilities associated with assets held for sale as of December 31, 2023.

In December 2022, in connection with the evaluation of strategic alternatives to monetize and dispose of Grace Pacific and the Company-owned quarry land on Maui, the Company's Board of Directors authorized Management to complete a sale of the Grace Disposal Group. In conjunction with the Board's authorization, the Company concluded that the Grace Disposal Group met the criteria for classification as held for sale and discontinued operations as of December 31, 2022, as it represented a strategic shift and was expected to have a material impact on the Company's operations and financial results. Accordingly, the assets and liabilities associated with the Grace Disposal Group are presented in the consolidated balance sheets as Assets held for sale and Liabilities associated with assets held for sale as of December 31, 2022, and the results of operations are presented as discontinued operations in the consolidated statements of operations and cash flows for all periods presented. As a result of the Grace Disposal Group's classification as held for sale, the assets and liabilities associated with the Grace Disposal Group were measured at fair value less any costs to sell as of December 31, 2022, and impairment of $89.8 million was recorded in the fourth quarter of 2022.

Refer to Note 7 – Fair Value Measurements for additional discussion of the inputs used to determine the fair value of assets held for sale.

The following table presents information related to the major classes of assets and liabilities that were classified as held for sale in the consolidated balance sheets as of December 31, 2023 and 2022 (in millions):


	2023		2022

Real estate investments
Real estate property	$	17.6	$	—
Accumulated depreciation	$	(1.8)	$	—
Real estate property, net	$	15.8	$	—
Real estate intangible assets, net	$	0.3	$	—
Real estate investments, net	$	16.1	$	—
Cash and cash equivalents	$	—	$	0.1

Accounts receivable and retention, net of allowance for credit losses and allowance for doubtful accounts of zero and $0.4 million as of December 31, 2023, and December 31, 2022, respectively	—		30.8
Inventories	—		45.0
Other property, net	—		67.4
Operating lease right-of-use assets	—		31.3

Prepaid expenses and other assets	0.1		42.0
Less: Impairment recognized on classification as held for sale	(2.2)		(89.8)
Total Assets held for sale	$	14.0	$	126.8

Notes payable and other debt	$	—	$	14.1
Accounts payable	—		10.2
Operating lease liabilities	—		31.3

Accrued and other liabilities	0.1		25.4
Total Liabilities associated with assets held for sale	$	0.1	$	81.0

The following table summarizes income (loss) from discontinued operations included in the Consolidated Statements of Operations for the three years ended December 31, 2023, 2022, and 2021, (in millions):


	20231		2022		2021

Revenue	$	201.2	$	171.2	$	126.2
Cost of sales2	(178.1)		(153.5)		(121.0)
Selling, general and administrative	(15.8)		(14.5)		(15.6)
Impairment of assets	—		(89.8)		(26.1)
Gain (loss) on disposal of non-core assets, net	(13.2)		0.1		0.1
Operating income (loss) from discontinued operations1	(5.9)		(86.5)		(36.4)
Income (loss) related to joint ventures	(1.5)		(0.4)		(0.4)
Impairment of equity method investments	—		—		(2.9)
Interest and other income (expense), net	0.1		0.5		0.2
Interest expense	(0.5)		(0.2)		(0.1)
Income (loss) from discontinued operations before income taxes1	(7.8)		(86.6)		(39.6)
Income tax benefit (expense) attributable to discontinued operations	—		—		—
Income (loss) from discontinued operations1	(7.8)		(86.6)		(39.6)
Loss (income) attributable to discontinued noncontrolling interest	(3.2)		(1.1)		(0.4)
Income (loss) from discontinued operations attributable to A&B Shareholders1	$	(11.0)	$	(87.7)	$	(40.0)
1Income (loss) from discontinued operations for year ended December 31, 2023 relates to the Grace Disposal Group only as Waipouli Town Center did not meet the criteria for discontinued operations.
2Includes $(0.1) million, $(0.4) million, and $(1.1) million in costs associated with the resolution of liabilities from the Company’s former sugar operations and previously presented in Income (loss) from discontinued operations for the years ended December 31, 2023, 2022, and 2021, respectively.

Related Party Transactions within Discontinued Operations and Held for Sale: The Company enters into contracts in the ordinary course of business, as a supplier, with affiliate entities that require accounting under the equity method due to the Company's financial interests in such entities and also with affiliate parties that are members in entities in which the Company also is a member and holds a controlling financial interest. Related to the periods during which such relationships existed, revenues earned from transactions with such affiliates were $13.7 million, $16.9 million and $9.3 million for the years ended December 31, 2023, 2022, and 2021, respectively. Expenses recognized from transactions with such affiliates were $4.4 million, $4.8 million and $1.4 million for the years ended December 31, 2023, 2022, and 2021, respectively. Receivables from these affiliates were zero and $6.9 million as of December 31, 2023 and 2022, respectively. Amounts due to these affiliates were zero and $0.4 million as of December 31, 2023 and 2022, respectively.