Acquisitions (Tables)

12 Months Ended

Dec. 31, 2016

The following unaudited consolidated pro forma information presents consolidated information as if the Merger had occurred on January 1, 2015:



	Pro Forma
	Year Ended December 31,
	2016		2015
Net sales	$	7,080,545	$	7,793,086

Net income ⁽¹⁾	$	398,826	$	662,750
Net income (loss) attributable to noncontrolling interest	22,748		(1,665		)
Net income attributable to Westlake Chemical Corporation ⁽¹⁾	$	376,078	$	664,415
Earnings per common share attributable to Westlake Chemical Corporation:
Basic	$	2.89	$	5.02
Diluted	$	2.88	$	5.00

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(1)

The 2016 pro forma net income amounts include Axiall's historical pre-tax charges recorded during the eight-month period prior to the closing of the Merger for (1) divestitures; (2) restructuring; and (3) legal and settlement claims, net, of $26,666, $22,881 and $23,376, respectively. These nonrecurring costs are included in the pro forma results because they were not directly attributable to the Merger.

Schedule of Business Acquisitions

As a portion of the goodwill arising from the Merger is attributable to foreign operations, there will be a continuing foreign currency impact to goodwill on the financial statements.



	Final Purchase Consideration as of August 31, 2016
Closing stock purchase:
Offer per share	$	33.00
Multiplied by number of shares outstanding at acquisition	67,277
Fair value of Axiall shares outstanding purchased by the Company	$	2,220,141
Plus:
Axiall debt repaid at acquisition	247,135
Seller's transaction costs paid by the Company ⁽¹⁾	47,458
Total fair value of consideration transferred	$	2,514,734

Fair value of Axiall share-based awards attributed to pre-combination service ⁽²⁾	$	11,346
Additional settlement value of shares acquired	13,280
Purchase consideration	$	2,539,360

Fair value of previously held equity interest in Axiall ⁽³⁾	102,300
Total fair value allocated to net assets acquired	$	2,641,660

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(1)	Transactions costs incurred by the seller included legal and advisory costs incurred for the benefit of Axiall's former shareholders and board of directors to evaluate the Company's initial Merger proposals, explore strategic alternatives and negotiate the purchase price.


(2)	The fair value of share-based awards attributable to pre-combination service includes the ratio of the pre-combination service performed to the original service period of the Axiall restricted share units and options, including related dividend equivalent rights.


(3)	Prior to the Merger, the Company owned 3.1 million shares in Axiall. The investment in Axiall was carried at estimated fair value with unrealized gains recorded as a component of accumulated other comprehensive loss on the consolidated balance sheet. The Company recognized a $49,080 gain for the investment in other income, net in the consolidated statement of operations upon gaining control.

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The information below represents the preliminary purchase price allocation:



Cash	$	88,251
Accounts receivable ⁽¹⁾	422,459
Income tax receivable	55,193
Inventories	306,158
Prepaid expenses and other current assets	55,462
Property, plant and equipment ⁽²⁾	3,134,741
Customer relationships (weighted average lives of 10.7 years) ⁽³⁾	590,000
Other intangible assets:
Trade name (weighted average lives of 6.8 years)	50,000
Technology (weighted average lives of 5.4 years)	41,500
Supply contracts and leases (weighted average lives of 6.3 years)	27,288
Other assets	98,708
Total assets acquired	$	4,869,760
Accounts and notes payable	255,232
Interest payable	8,154
Income tax payable	967
Accrued compensation	44,186
Accrued liabilities	152,550
Deferred income taxes	985,128
Tax reserve non-current	3,130
Pension and other post-retirement obligations	311,106
Other liabilities	99,848
Long-term debt	1,187,290
Total liabilities assumed	$	3,047,591
Total identifiable net assets acquired	$	1,822,169
Noncontrolling interest	(68,000		)
Goodwill	887,491
Total fair value allocated to net assets acquired	$	2,641,660

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(1)	The fair value of accounts receivable acquired is $422,459, with the gross contractual amount being $434,834. The Company expects $12,375 to be uncollectible.


(2)	The Company obtained additional information related to its property plant and equipment balances which led to a decrease in property plant and equipment of $54,841 and a corresponding increase in goodwill.


(3)	The Company obtained additional information related to its customer relationship balances which led to an increase in customer relationship of $30,000 and a corresponding decrease in goodwill.