PBF Energy 2013 Annual Report Download - page 124

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PBF ENERGY INC. AND
PBF HOLDING COMPANY LLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)
F- 28
The Company purchased certain finished and intermediate products for approximately $299,645 with the proceeds
from a note provided by Sunoco (the “Toledo Inventory Note Payable”). The note had an interest rate at the lower
of LIBOR plus 5.5%, or 7.5% and was repaid on May 31, 2011. The Company also purchased crude oil inventory
for $338,395, which it concurrently sold to MSCG for its market value of $369,999. The net cash received from
this transaction was recorded as a reduction in the total purchase price.
The Toledo acquisition was accounted for as a business combination. The purchase price of $784,818 includes the
estimated fair value of future participation payments (contingent consideration). The fair value of the contingent
consideration was estimated using a discounted cash flow analysis, a Level 3 measurement, as more fully described
at Note 21. The following table summarizes the amounts recognized for assets acquired and liabilities assumed as
of the acquisition date.
The total purchase price and the estimated fair values of the assets and liabilities at the acquisition date were as
follows:
Purchase Price
Net cash $ 168,156
Seller promissory note 200,000
Seller note for inventory 299,645
Estimated fair value of contingent consideration 117,017
$ 784,818
Fair Value
Allocation
Current assets $ 305,645
Land 8,065
Property, plant and equipment 452,084
Other assets 24,640
Current liabilities (5,616)
$ 784,818
The Company’s consolidated financial statements for the years ended December 31, 2013, 2012 and 2011 include
the results of operations of the Toledo refinery since March 1, 2011. The actual results for the Toledo refinery for
the period from March 1, 2011 to December 31, 2011, are shown below. The revenues and net income of the
Company assuming the acquisition had occurred on January 1, 2011, are shown below on a pro forma basis. The
pro forma information does not purport to present what the Company’s actual results would have been had the
acquisition occurred on January 1, 2011, nor is the financial information indicative of the results of future operations.
The unaudited pro forma financial information includes the depreciation and amortization expense related to the
acquisition and interest expense associated with the Toledo acquisition financing.
Revenues Net Income
Actual results for March 1, 2011 to December 31, 2011 $ 6,113,055 $ 489,243
Supplemental pro forma for January 1, 2011 to December 31, 2011 $ 15,961,529 $ 328,142