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Distribution Agreements, Net (Tables) - Distribution Agreements [Member]
 9 Months Ended
Sep. 30, 2018
Other Identifiable Intangible Assets Net

Distribution agreements, net, which are amortized on a straight line basis and have an estimated useful life of 20 to 40 years, consisted of the following:

 

(in thousands)

 

September 30, 2018

 

 

December 31, 2017

 

Distribution agreements at cost

 

$

945,895

 

 

$

939,527

 

Less: Accumulated amortization

 

 

(44,064

)

 

 

(26,175

)

Distribution agreements, net

 

$

901,831

 

 

$

913,352

 

 
Reconciliation of Activity for Other Identifiable Intangible Assets Net

A reconciliation of the activity for distribution agreements, net for the first three quarters of 2018 and the first three quarters of 2017 is as follows:

 

 

 

First Three Quarters

 

(in thousands)

 

2018

 

 

2017

 

Beginning balance - distribution agreements, net

 

$

913,352

 

 

$

234,988

 

Conversion to distribution rights from franchise rights(1)

 

 

-

 

 

 

533,040

 

System Transformation Transactions acquisitions

 

 

-

 

 

 

36,800

 

Measurement period adjustment(2)

 

 

4,700

 

 

 

-

 

Other distribution agreements

 

 

1,668

 

 

 

44

 

Additional accumulated amortization

 

 

(17,889

)

 

 

(11,774

)

Balance held for sale(3)

 

 

-

 

 

 

(63,321

)

Ending balance - distribution agreements, net

 

$

901,831

 

 

$

729,777

 

 

 

(1)

In connection with the closing of the March 2017 Transactions, the Company, The Coca-Cola Company and CCR entered into a comprehensive beverage agreement (as amended, the “CBA”) on March 31, 2017, and concurrently converted the Company’s franchise rights within the territories in which the Company distributed Coca‑Cola products prior to beginning the System Transformation to distribution agreements, net on the consolidated condensed financial statements. Prior to this conversion, the Company’s franchise rights resided entirely within the Nonalcoholic Beverages segment.

 

(2)

Measurement period adjustment relates to post-closing adjustments made in relation to the Memphis Transaction in accordance with the terms and conditions of the September 2017 APA. The adjustment to amortization expense associated with this measurement period adjustment was not material to the consolidated condensed financial statements. See Note 3 to the consolidated condensed financial statements for additional information on the System Transformation Transactions.

 

(3)

Distribution agreements, net of $63.3 million related to the October 2017 Divestitures was classified as held for sale as of October 1, 2017.