INVESTMENTS

Equity Method Investments

As of September 30, 2018, our investments in joint ventures of $1.7 million consisted of a 40% equity ownership interest in Madison Paper Industries (“Madison”), a partnership that previously operated a supercalendered paper mill in Maine. The Company and UPM-Kymmene Corporation (“UPM”), a Finnish paper manufacturing company, are partners through subsidiary companies in Madison. The Company’s 40% ownership of Madison is through an 80%-owned consolidated subsidiary that owns 50% of Madison. UPM owns 60% of Madison, including a 10% interest through a 20% noncontrolling interest in the consolidated subsidiary of the Company.

In 2016, the paper mill closed and we recognized a $41.4 million loss related to the closure. As a result of the mill closure, we wrote our investment down to zero. In the fourth quarter of 2016, Madison sold certain assets at the mill site and we recognized a $3.9 million gain related to the sale. In 2017, we recognized a $20.8 million gain, primarily related to the sale of the remaining assets (which primarily consisted of hydro power assets), partially offset by the loss related to Madison’s settlement of certain pension obligations. The partnership is currently in the process of liquidation.

The investment is accounted for under the equity method, and is recorded in “Miscellaneous assets” in our Condensed Consolidated Balance Sheets. Our proportionate share of the operating results of our investment is recorded in “(Loss)/Gain from joint ventures” in our Condensed Consolidated Statements of Operations.

The following table presents summarized income statement information for Madison, which follows a calendar year:



	For the Quarters Ended						For the Nine Months Ended
(In thousands)	September 30, 2018			September 30, 2017			September 30, 2018			September 30, 2017
Revenues	$	—		$	—		$	—		$	—
Expenses:
Cost of sales	—			(105		)	—			(1,277		)
General and administrative (expense)/income and other	(65		)	60,216			(99		)	59,662
Total (expense)/income	(65		)	60,111			(99		)	58,385
Operating (loss)/income	(65		)	60,111			(99		)	58,385
Other income/(expense)	33			(1		)	81			(7		)
Net (loss)/income	$	(32	)	$	60,110		$	(18	)	$	58,378

We received no distributions from Madison during the third quarters and first nine months of 2018 and 2017, respectively.

Non-Marketable Equity Securities

Our non-marketable equity securities are investments in privately held companies/funds without readily determinable market values. Prior to January 1, 2018 and the adoption of ASU 2016-01, we accounted for our non-marketable equity securities at cost less impairment. Subsequent to the adoption of ASU 2016-01 as of January 1, 2018, we elected the measurement alternative, defined as cost, less impairments, adjusted by observable price changes given our non-marketable equity securities are without readily determinable fair values. We estimate the fair value based on valuation methods using the observable transaction price at the transaction date. Realized gains and losses on non-marketable securities sold or impaired are recognized in “Interest expense and other, net.”

Non-marketable equity securities are classified within Level 3 in the fair value hierarchy. See Note 9 for the definition of Level 3. As of September 30, 2018 and December 31, 2017, non-marketable equity securities included in “Miscellaneous assets’’ in our Condensed Consolidated Balance Sheets had a carrying value of $14.6 million and $13.6 million, respectively. We did not have any material fair value adjustments in the third quarter and first nine months of 2018.