East Dubuque Merger (Tables)

12 Months Ended

Dec. 31, 2016

A summary of the total purchase price is as follows:



	Purchase Price
	(in millions)
Fair value of CVR Partners common units issued, as of the close of the East Dubuque Merger	$	335.7
Cash payment to CVR Nitrogen common unitholders and certain phantom unitholders	99.2
Fair value of consideration transferred	434.9
Fair value of noncontrolling interest for parent affiliate units (1)	4.6
Total purchase price consideration to be allocated	$	439.5

The fair value of the unit consideration was determined as follows:




	Fair Value of Unit Consideration
	(units in thousands)
CVR Nitrogen common units outstanding, as of the close of the East Dubuque Merger	38,985
Less: Noncontrolling interest from parent affiliate units (1)	400
Net units subject to merger consideration	38,585
Unit consideration per CVR Nitrogen common unit	1.04
Number of CVR Partners common units issued for merger consideration	40,129
Number of CVR Partners common units issued for CVR Nitrogen phantom units issued to noncontinuing employees and CVR Nitrogen board members (2)	26
Total number of CVR Partners units issued	40,155
Fair value per CVR Partners common unit, as of the close of the East Dubuque Merger	$	8.36
Fair value of CVR Partners common units issued (in millions)	$	335.7

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(1)	See above for discussion of parent affiliate units.


(2)	As discussed above, each phantom unit granted and outstanding and held by (i) an employee who did not continue in the employment of a CVR Partners-affiliated entity, or (ii) a director of CVR Nitrogen GP, upon closing of the East Dubuque Merger, vested in full and the holders thereof received the merger consideration.

Schedule of net tangible assets acquired

The following table, set forth below, displays the purchase price allocated to CVR Nitrogen's net tangible assets based on their fair values as of April 1, 2016. There were no identifiable intangible assets.



	Purchase Price Allocation
	(in millions)
Cash	$	35.4
Accounts receivable	8.9
Inventories	49.1
Prepaid expenses and other current assets (1)	5.2
Property, plant and equipment	775.3
Other long-term assets	1.1
Deferred revenue	(29.8		)
Other current liabilities (2)	(37.0		)
Long-term debt	(367.5		)
Other long-term liabilities	(1.2		)
Total fair value of net assets acquired	439.5
Less: Cash acquired	35.4
Total consideration transferred, net of cash acquired	$	404.1

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(1)	Includes $4.0 million for the estimated fair value of insurance proceeds related to an event that occurred prior to the East Dubuque Merger. The Partnership received $4.0 million during the second quarter of 2016, which was included in operating activities on the Consolidated Statement of Cash Flows the year ended December 31, 2016.


(2)	Includes an assumed liability of $11.8 million for third-party financial advisory services provided to CVR Nitrogen that became payable upon the closing of the East Dubuque Merger, and was subsequently paid by CVR Partners on April 1, 2016, which was included in operating activities on the Consolidated Statement of Cash Flows for the year ended December 31, 2016.

Summary pro forma financial information



	Year Ended December 31,
	2016			2015

	(in thousands, except per unit data)
Net sales	$	391,132		$	490,538
Net income (loss)	(14,619		)	89,818
Net income (loss) per common unit, basic and diluted	(0.13		)	0.79