Acquisitions and Dispositions (Tables)

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Summary of assets acquired and liabilities assumed

The preliminary fair value recorded for the assets acquired and liabilities assumed for ESOL is as follows:

	Preliminary Valuation
(In millions)	April 6 2020		Measurement Period Adjustments		June 30 2020
Cash and cash equivalents	$	0.4	$	—	$	0.4
Trade accounts receivable	124.1		—		124.1
Inventory	5.0		—		5.0
Other current assets	0.7		—		0.7
Property, plant and equipment	105.3		—		105.3
Right-of-use assets	56.0		—		56.0
Goodwill	152.0		—		152.0
Intangible assets	161.0		—		161.0
Other assets	0.2		—		0.2
Accounts payable	(48.6)		—		(48.6)
Accrued expenses	(17.5)		—		(17.5)
Current portion of operating lease liabilities	(16.6)		—		(16.6)
Other current liabilities	(6.4)		—		(6.4)
Environmental liabilities	(24.4)		—		(24.4)
Deferred income taxes	(15.5)		—		(15.5)
Operating lease liabilities	(39.4)		—		(39.4)
Total identifiable net assets of ESOL	436.3		—		436.3
Non-compete agreement	2.5		—		2.5
Total identifiable net assets of ESOL	$	438.8	$	—	$	438.8

The fair value recorded for the assets acquired and liabilities assumed for Clean Earth is as follows: 

	Final
(In millions)	June 28, 2019		Measurement Period Adjustments (a)		June 30 2020
Cash and cash equivalents (b)	$	42.8	$	(39.2)	$	3.6
Trade accounts receivable, net	63.7		(1.2)		62.5
Other receivables	0.8		1.3		2.1
Other current assets	8.7		(1.4)		7.3
Property, plant and equipment	75.6		1.4		77.0
Right-of-use assets	14.4		11.4		25.8
Goodwill	313.8		16.8		330.6
Intangible assets	261.1		(18.9)		242.2
Other assets	4.0		(2.8)		1.2
Accounts payable	(23.0)		(0.1)		(23.1)
Acquisition consideration payable (b)	(39.2)		39.2		—
Other current liabilities	(18.0)		(1.7)		(19.7)
Net deferred taxes liabilities	(51.2)		5.5		(45.7)
Operating lease liabilities	(11.1)		(8.4)		(19.5)
Other liabilities	(6.5)		(2.1)		(8.6)
Total identifiable net assets of Clean Earth	$	635.9	$	(0.2)	$	635.7

(a)  The measurement period adjustments did not have a material impact on the Company's previously reported operating results.

(b)  Acquisition consideration payable represents a portion of the cash consideration not paid out until July 2019.

Preliminary valuation of identifiable intangible assets and amortization periods

The following table details the preliminary valuation of identifiable intangible assets and amortization periods for ESOL and the non-compete entered into by the Company upon acquisition of ESOL:

		Preliminary Valuation
(Dollars in millions)	Weighted-Average Amortization Period	April 6 2020		Measurement Period Adjustments (a)		June 30 2020
Permits and rights	22 years	$	138.0	$	0.0	$	138.0
Customer relationships	10 years	23.0		0.0		23.0
Total identifiable intangible assets of ESOL		161.0		0.0		161.0
Non-compete agreement	4 years	2.5		0.0		2.5
Total identifiable intangible assets acquired		$	163.5	$	0.0	$	163.5

The following table details the preliminary valuation of identifiable intangible assets and amortization periods for Clean Earth:

		Final
(Dollars in millions)	Weighted-Average Amortization Period	Preliminary Valuation June 28, 2019		Measurement Period Adjustments (c)		June 30 2020
Permits	18 years	$	176.1	$	(6.0)	$	170.1
Customer relationships	8 years	33.4		(12.9)		20.5
Air rights	Usage based (d)	25.6		—		25.6
Trade names	12 years	26.0		—		26.0
Total identifiable intangible assets of Clean Earth		$	261.1	$	(18.9)	$	242.2

(c)  The measurement period adjustments did not have a material impact on the Company's previously reported operating results.

(d)  The Company estimates that based on current usage that the expected useful life would be 27 years.

Pro forma information

	Three Months Ended				Six Months Ended
	June 30				June 30
(In millions)	2020		2019		2020		2019
Pro forma revenues	$	447.3	$	564.4	$	976.8	$	1,078.1
Pro forma net income (including discontinued operations)	2.0		23.5		2.7		12.8

Balance sheet positions and financial information included in net income from discontinued operations and statements of cash flows

Certain key selected financial information included in net income from discontinued operations for the former Harsco Industrial Segment is as follows:

	Three Months Ended				Six Months Ended
	June 30				June 30
(In millions)	2020		2019		2020		2019
Amounts directly attributable to the former Harsco Industrial Segment:
Total revenues	$	—	$	116,796	$	10,203	$	234,182
Cost of products sold	—		85,319		8,082		173,014
Income from discontinued business	(95)		9,882		123		24,074
Additional amounts allocated to the former Harsco Industrial Segment:
Selling, general and administrative expenses (e)	$	(77)	$	3,527	$	1,189	$	3,527
Interest expense (f)	—		7,005		—		11,237

(e) The Company has allocated directly attributable transaction costs to discontinued operations.

(f) The Company has allocated interest expense, including a portion of the amount reclassified into income for the Company's interest rate swaps and amortization of deferred financing costs resulting from the AXC disposal, as part of discontinued operations.

The following is selected financial information included on the Company's Condensed Consolidated Statements of Cash Flows attributable to the former Harsco Industrial Segment:

	Six Months Ended
	June 30
(In millions)	2020		2019
Non-cash operating items
Depreciation and amortization	$	—	$	3,301
Cash flows from investing activities
Purchases of property, plant and equipment	106		5,221