Acquisitions and Dispositions (Tables)

12 Months Ended

Dec. 31, 2020

Business Combinations [Abstract]

Disposal Groups, Including Discontinued Operations

The former Harsco Industrial Segment's balance sheet positions of IKG as of December 31, 2019 are presented as Assets held-for-sale and Liabilities of assets held-for-sale in the Company’s Consolidated Balance Sheets and are summarized as follows:

(in thousands)	December 31, 2019
Trade accounts receivable, net	$	10,982
Other receivables	78
Inventories	9,838
Other current assets	655
Property, plant and equipment, net	20,703
Right-of-use assets, net	11,230
Other assets	96
Total assets	$	53,582
Accounts payable	$	5,060
Accrued compensation	2,324
Current portion of advances on contracts	1,168
Current portion of operating lease liabilities	1,575
Other current liabilities	1,218
Operating lease liabilities	9,837
Other liabilities	2,314
Total liabilities	$	23,496

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

	Years ended December 31
(In millions)	2020		2019		2018
Amounts directly attributable to the former Harsco Industrial Segment:
Total revenues	$	10,203	$	306,972	$	374,707
Cost of products sold	8,082		224,811		276,198
Gain on sale from discontinued businesses	18,281		569,135		—
Income (loss) from discontinued business	(1,578)		27,823		43,593
Additional amounts allocated to the former Harsco Industrial Segment:
Selling, general and administrative expenses (h)	$	2,695	$	8,429	$	—
Interest expense (i)	—		11,237		16,613
Loss on early extinguishment of debt (j)	—		5,314		—

(h) The Company has allocated directly attributable transaction costs to discontinued operations. In addition, this caption includes costs directly attributable to retained contingent liabilities of the Harsco Industrial Segment.

(i) The Company has allocated interest expense, including a portion of the amount reclassified into income for the Company's interest rate swaps, amortization of deferred financing costs, and $2.7 million related to interest rate swap terminations which occurred during the year ended December 31, 2019, all of which were directly attributed with the mandatory repayment of the Company's Term Loan Facility, resulting from the AXC disposal, as part of discontinued operations.

(j)    The Company has allocated the $5.3 million write-off of deferred financing costs to discontinued operations as it is directly attributed to the mandatory repayment of the Term Loan Facility that resulted from the AXC disposal.

Business Acquisition, Pro Forma Information

The values assigned to the assets acquired and liabilities assumed are based on preliminary valuations, for the ESOL acquisition, and are subject to change as the Company obtains additional information during the measurement period. In addition, the historical ESOL results include $8.9 million and $35.7 million for the years ended December 31, 2020 and 2019, respectively, of corporate expenses charged to ESOL from Stericycle, Inc.

	Year Ended December 31 (unaudited)
(In millions)	2020		2019
Pro forma revenues	$	1,994.5	$	2,185.2
Pro forma net income (including discontinued operations) (e)	0.1		471.3

(e)     Pro forma net income for 2020 includes the after tax gains on the sale of IKG of approximately $9 million, and the 2019 includes the after-tax gains on the sale of AXC and PK of approximately $454 million.

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		December 31 2020
Cash and cash equivalents	$	0.4	$	—	$	0.4
Trade accounts receivable	124.1		(1.2)		122.9
Inventory	5.0		—		5.0
Other current assets	0.7		(0.4)		0.3
Property, plant and equipment	105.3		(3.1)		102.2
Right-of-use assets	56.0		—		56.0
Goodwill	152.0		0.1		152.1
Intangible assets	161.0		—		161.0
Other assets	0.2		—		0.2
Accounts payable	(48.6)		(1.5)		(50.1)
Accrued expenses	(17.5)		(2.0)		(19.5)
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)		(1.7)		(17.2)
Operating lease liabilities	(39.4)		—		(39.4)
Total identifiable net assets of ESOL	436.3		(9.8)		426.5
Non-compete agreement	2.5		—		2.5
Total identifiable net assets of ESOL, including non-compete agreement	$	438.8	$	(9.8)	$	429.0

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)		December 31 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.

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

		Final Valuation
(In millions)		June 30 2018		Measurement Period Adjustments (f)		March 31 2019
Cash and cash equivalents		$	1.7	$	—	$	1.7
Net working capital		(1.5)		0.2		(1.3)
Property, plant and equipment		3.3		—		3.3
Intangible assets	Just	52.5		0.2		52.7
Goodwill		20.9		1.6		22.5
Net deferred tax liabilities		(8.5)		—		(8.5)
Other liabilities		(0.3)		—		(0.3)
Total identifiable net assets of Altek		$	68.1	$	2.0	$	70.1

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

Summary of 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 agreement entered into by the Company upon acquisition of ESOL:

		Preliminary Valuation
(Dollars in millions)	Weighted-Average Amortization Period	April 6 2020		Measurement Period Adjustments		December 31 2020
Permits and rights	22 years	$	138.0	$	—	$	138.0
Customer relationships	10 years	23.0		—		23.0
Total identifiable intangible assets of ESOL		161.0		—		161.0
Non-compete agreement	4 years	2.5		—		2.5
Total identifiable intangible assets acquired		$	163.5	$	—	$	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)		December 31 2020
Permits	18 years	$	176.1	$	(6.0)	$	170.1
Customer relationships and backlog	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.

Summary of changes in fair value of contingent consideration

The following table reflects the changes in the fair value of contingent consideration which occurred since acquisition:

(In thousands)	2020		June 28, 2019 through December 31, 2019
Balance at beginning of year	$	3,400	$	3,100
Payment	(2,342)		(525)
Fair value adjustment	112		825
Balance at end of year	$	1,170	$	3,400

The following table reflects the changes in the fair value of contingent consideration:

(In thousands)	2019		2018
Balance at beginning of year	$	8,420	$	—
Recognition of contingent consideration	—		10,097
Measurement period adjustment	—		1,958
Fair value adjustment (g)	(8,506)		(2,939)
Foreign currency translation	86		(696)
Balance at end of year	$	—	$	8,420

(g) The fair value adjustment resulted from the decreased probability of Altek achieving cumulative financial and non-financial performance goals within the required time frame. This amount is recorded in Other expenses, net on the Consolidated Statements of Operations.