2. ACQUISITIONS

Acquisition of Fleischmann’s Vinegar Company

On October 3, 2016, the company acquired all of the issued and outstanding stock of SCI Ingredients, the holding company of Fleischmann’s Vinegar Company, Inc., for $258.3 million in cash. A portion of the purchase price was used to repay existing debt. Fleischmann’s Vinegar is one of the world’s largest producers of food-grade industrial vinegar.

The purchase price allocation is based on the preliminary results of independent valuations. The purchase price and purchase price allocation are preliminary until contractual post-closing working capital adjustments are finalized and the final independent valuation reports are issued.

The following is a summary of the preliminary purchase price of assets acquired and liabilities assumed (in thousands):


Amounts of Identifiable Assets Acquired and Liabilities Assumed
Cash		$	4,148
Inventory			9,308
Accounts receivable, net			13,919
Prepaid expenses and other			1,054
Property and equipment			43,011
Intangible assets			94,500

Current liabilities			(9,689)
Income taxes payable			(330)
Deferred tax liabilities			(40,421)
	Total identifiable net assets		115,500

Goodwill			142,819
	Purchase price	$	258,319

As of March 31, 2017, based on the preliminary valuations, the company’s customer relationship intangible asset recognized in connection with the Fleischmann’s acquisition is $81.2 million, net of $2.8 million of accumulated amortization, and has a 15-year weighted-average amortization period. As of March 31, 2017, the company also has an indefinite-lived trade name intangible asset of $10.5 million. The company recognized $1.4 million of amortization expense associated with the amortizing customer relationship intangible asset during the three months ended March 31, 2017 and estimated amortization expense for the next five years is $5.6 million per annum. The excess of the purchase price over the intangibles fair values was allocated to goodwill, none of which is expected to be deductible for tax purposes. The goodwill is primarily attributable to the synergies expected to arise after the acquisition.

Acquisition of Abengoa Ethanol Plants

On September 23, 2016, the company acquired three ethanol plants located in Madison, Illinois, Mount Vernon, Indiana, and York, Nebraska from subsidiaries of Abengoa S.A. for approximately $234.9 million for the ethanol plant assets, and $19.1 million for working capital acquired and liabilities assumed. These ethanol facilities have a combined annual production capacity of approximately 230 mmgy.

The purchase price allocation is based on the preliminary results of an independent valuation. The purchase price and purchase price allocation are preliminary until contractual post-closing working capital adjustments are finalized and the final independent valuation report is issued. The following is a summary of the preliminary purchase price of assets acquired and liabilities assumed (in thousands):


Amounts of Identifiable Assets Acquired and Liabilities Assumed
Inventory		$	16,904
Accounts receivable, net			1,826
Prepaid expenses and other			2,224
Property and equipment, net			234,947
Other assets			3,885

Current maturities of long-term debt			(406)
Current liabilities			(2,580)
Long-term debt			(2,763)
	Total identifiable net assets	$	254,037

Concurrently with the company’s acquisition of the Abengoa ethanol plants, on September 23, 2016, the partnership acquired the storage assets of the Abengoa ethanol plants from the company for $90.0 million in a transfer between entities under common control and entered into amendments to the related commercial agreements with Green Plains Trade.