Acquisitions (Tables)

12 Months Ended

Dec. 31, 2013

Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net

The effects of changes in our ownership interests in Geostream and AlMansoori Key Energy Services, LLC for the year ended December 31, 2013 were as follows (in thousands):

Net loss attributable to Key	$	(21,768	)
Transfers from the noncontrolling interests
Increase in Key's paid-in capital for purchase of the 50% noncontrolling interest in Geostream	22,432
Decrease in Key's paid-in capital for purchase of the 51% noncontrolling interest in AlMansoori Key Energy Services, LLC	(2,888		)
Net transfers from noncontrolling interests	19,544
Change from net loss attributable to Key and transfers from noncontrolling interests	$	(2,224	)

Acquisition-Date Fair Value of the Consideration Transferred

The following table summarizes the fair values of the assets acquired and liabilities assumed (in thousands):

Cash	$	189,696
Key common stock	117,919
Consideration transferred	307,615
Working capital adjustment	(1,752		)
Total	$	305,863

Proforma Consolidated Income Statement

The following represents the pro forma consolidated income statement as if the Edge acquisition had been included in our consolidated results prior to 2011 for the year ended December 31, 2011:

	2011
	(unaudited) (in thousands, except per share amounts)
REVENUES	$	1,803,768
COSTS AND EXPENSES:
Direct operating expenses	1,115,770
Depreciation and amortization expense(1)	176,298
General and administrative expenses(2)	227,652
Operating income	284,048
Loss on early extinguishment of debt	46,451
Interest expense, net of amounts capitalized	42,389
Other income, net	(7,585		)
Income from continuing operations before tax	202,793
Income tax expense(3)	(76,169		)
Income from continuing operations	126,624
Loss from discontinued operations, net of tax	(10,303		)
Net income	116,321
Loss attributable to noncontrolling interest	(806		)
INCOME ATTRIBUTABLE TO KEY	$	117,127
Earnings per share attributable to Key:
Basic	$	0.79
Diluted	$	0.79
Weighted average shares outstanding(4):
Basic	150,397
Diluted	150,705

(1) Depreciation and amortization expense has been adjusted to reflect the additional expense that would have been charged assuming the fair value adjustments to property and equipment and intangible assets had been applied prior to 2011.

(2) Transaction costs of $3.6 million have been removed as these costs would have occurred prior to 2011.

(3) Income tax expense has been adjusted to reflect applicable corporate tax as if Edge had been acquired and converted from its LLC status prior to 2011.

(4) Weighted average shares outstanding has been adjusted to reflect the issuance of shares in the Edge transaction as if the transaction occurred prior to 2011.

Edge Oilfield Services, LLC and Summit Oilfield Services, LLC

Changes in the estimated fair values of the assets acquired and liabilities assumed

The following table summarizes the fair values of the assets acquired and the liabilities assumed (in thousands):

At August 5, 2011:
Cash and cash equivalents	$	886
Accounts receivable	21,124
Other current assets	234
Property and equipment	87,185
Intangible assets	49,310
Other long term assets	3,826
Total identifiable assets acquired	162,565
Current liabilities	19,406
Total liabilities assumed	19,406
Net identifiable assets acquired	143,159
Goodwill	162,704
Net assets acquired	$	305,863