Note 16: Acquisitions and Divestitures

In the second quarter of 2013, we acquired an aggregates production facility and four ready-mixed concrete facilities for $29,983,000. As a result, we recognized $5,542,000 of amortizable intangible assets (contractual rights in place), all of which will be deducted for income tax purposes over 15 years. The contractual rights in place will be amortized against earnings using the unit-of-production method over an estimated weighted-average period in excess of 50 years. The purchase price allocation for this 2013 acquisition is preliminary pending final appraisals.

In the first quarter of 2013, we acquired two aggregates production facilities for $59,968,000. The initial accounting for the business combination was not finalized at the end of the first quarter because appraisals of amortizable intangible assets (contractual rights in place) and property, plant & equipment were not completed. Provisional amounts for contractual rights in place and property, plant & equipment were adjusted to the appraised values in the second quarter of 2013. These adjustments resulted in an increase in contractual rights in place from $800,000 to $3,620,000, an increase in property, plant & equipment from $45,888,000 to $47,884,000 and a decrease in goodwill from $9,759,000 to $4,698,000. The comparative balance sheet as of March 31, 2013 will be retrospectively adjusted to reflect these adjustments. The impact of applying these adjustments retrospectively to the first quarter 2013 statement of comprehensive income was immaterial. The contractual rights in place will be amortized against earnings using the unit-of-production method over an estimated weighted-average period in excess of 20 years. All of the intangible assets (goodwill and contractual rights in place) are deductible for income tax purposes over 15 years.

In the second quarter of 2013, we sold four aggregates production facilities resulting in net pretax cash proceeds of $34,743,000 and a pretax gain of $21,048,000. We allocated $4,521,000 of goodwill to these dispositions based on the relative fair values of the businesses disposed of and the portion of the reporting unit retained. Additionally, the dispositions of these facilities will likely result in a partial withdrawal from one of our multiemployer pension plans; therefore, we recognized a $4,000,000 withdrawal liability.

In the first quarter of 2013, we sold an aggregates production facility and its related replacement reserve land resulting in net pretax cash proceeds of $5,133,000 and a pretax gain of $2,802,000. We allocated $674,000 of goodwill to this disposition based on the relative fair values of the business disposed of and the portion of the reporting unit retained. Additionally, we sold equipment and other personal property from two idled prestress concrete production facilities in the first quarter of 2013 resulting in net pretax cash proceeds of $622,000 and a pretax gain of $457,000.

Pending divestitures (Aggregates segment — a previously mined and subsequently reclaimed tract of land, and Ready-mix segment — a former site of a ready-mix facility) are presented in the accompanying Condensed Consolidated Balance Sheet as of June 30, 2013 as assets held for sale and liabilities of assets held for sale. We expect the sales to occur during 2013. Likewise, pending divestitures as of December 31, 2012 (Aggregates segment — a previously mined and subsequently reclaimed tract of land, an aggregates production facility and its related replacement reserve land, and Ready-mix segment — a former site of a ready-mix facility) are presented in the accompanying Condensed Consolidated Balance Sheet as of December 31, 2012 as assets held for sale and liabilities of assets held for sale. The major classes of assets and liabilities of assets classified as held for sale are as follows:



	June 30	December 31	June 30
in thousands	2013	2012	2012
Held for Sale
Current assets	$ 0	$ 809	$ 0
Property, plant & equipment, net	12,926	14,274	0
Total assets held for sale	$ 12,926	$ 15,083	$ 0
Noncurrent liabilities	$ 0	$ 801	$ 0
Total liabilities of assets held for sale	$ 0	$ 801	$ 0

During the first six months of 2012, we sold:

§	mitigation credits resulting in net pretax cash proceeds of $13,469,000 and a pretax gain of $12,342,000

§	real estate resulting in net pretax cash proceeds of $9,691,000 and a pretax gain of $5,979,000

Effective land management is both a business strategy and a social responsibility. We strive to achieve value through our mining activities as well as incremental value through effective post-mining land management. Our land management strategy includes routinely reclaiming and selling our previously mined land. Additionally, this strategy includes developing conservation banks by preserving land as a suitable habitat for endangered or sensitive species. These conservation banks have received approval from the United States Fish and Wildlife Service to offer mitigation credits for sale to third parties who may be required to compensate for the loss of habitats of endangered or sensitive species.