Discontinued Operations

12 Months Ended

Dec. 31, 2022

Discontinued Operations and Disposal Groups [Abstract]

Sale of Liberty

On July 16, 2021, the LLC, as majority stockholder of Liberty Safe Holding Corporation and as Sellers Representative, entered into a definitive Stock Purchase Agreement (the “Liberty Purchase Agreement”) with

Independence Buyer, Inc. (“Liberty Buyer”), Liberty and the other holders of stock and options of Liberty to sell to Liberty Buyer all of the issued and outstanding securities of Liberty, the parent company of the operating entity, Liberty Safe and Security Products, Inc.

On August 3, 2021, Liberty Buyer and the LLC, as Sellers Representative, entered into the Amendment to Stock Purchase Agreement (the “Liberty Amendment”) which amended the Liberty Purchase Agreement to, among other things, provide that, immediately prior to the closing, certain investors in Liberty will, instead of selling all of the shares of Liberty owned by them to Liberty Buyer, contribute a portion of such shares (the “Liberty Rollover Shares”) to an indirect parent company of Liberty Buyer in exchange for equity securities of such entity.

On August 3, 2021, Liberty Buyer completed the acquisition of all the issued and outstanding securities of Liberty (other than the Liberty Rollover Shares) pursuant to the Liberty Purchase Agreement and Liberty Amendment (the “Liberty Transaction”). The sale price of Liberty was based on an aggregate total enterprise value of $147.5 million, subject to customary adjustments. After the allocation of the sale proceeds to Liberty's non-controlling shareholders, the repayment of intercompany loans to the LLC (including accrued interest) of $26.5 million, and the payment of transaction expenses of approximately $4.5 million, the LLC received approximately $128.0 million of total proceeds from the sale at closing. The LLC recognized a gain on the sale of Liberty of $72.8 million during the year ended December 31, 2021. In 2022, the LLC received an income tax refund of approximately $0.9 million related to Liberty which was recognized as gain on sale of discontinued operations, net of taxes, in the accompanying consolidated statement of operations.

Summarized results of operations of Liberty for the previous years through the date of disposition are as follows (in thousands):


	For the period January 1, 2021 through disposition		Year ended December 31, 2020
Net sales	$	75,753	$	113,115
Gross profit	20,129		28,978
Operating income	9,175		16,826
Income from continuing operations before income taxes (1)	9,174		16,819
Provision for income taxes	1,509		3,288
Income from discontinued operations (1)	$	7,665	$	13,531

(1) The results of operations for the periods from January 1, 2021 through disposition and the year ended December 31, 2020, each exclude $1.7 million and $3.5 million, respectively, of intercompany interest expense.

Sale of Clean Earth

On May 8, 2019, the LLC, as majority stockholder of CEHI Acquisition Corporation ("Clean Earth" or CEHI") and as Sellers’ Representative, entered into a definitive Stock Purchase Agreement (the “Clean Earth Purchase Agreement”) with Calrissian Holdings, LLC (“Clean Earth Buyer”), CEHI, the other holders of stock and options of CEHI and, as Clean Earth Buyer’s guarantor, Harsco Corporation, pursuant to which Clean Earth Buyer would acquire all of the issued and outstanding securities of CEHI, the parent company of the operating entity, Clean Earth, Inc. The LLC recognized a gain on the sale of Clean Earth of $209.3 million during the year ended December 31, 2019. In 2022, the LLC received an income tax refund of approximately $8.5 million related to Clean Earth which was recognized as gain on sale of discontinued operations, net of taxes, in the accompanying consolidated statement of operations.