Business Combinations

12 Months Ended

Dec. 31, 2021

In December 2021, we acquired certain assets and assumed certain liabilities of Lentzcaping, Inc. and Lentzcaping, LLC (together, "Lentzcaping"). Lentzcaping has been a valued partner for Newpark in recent years, primarily serving utility transmission customers in the Northeast U.S. and providing a variety of complementary services, including worksite planning and preparation, temporary access, and worksite restoration. The purchase price for this acquisition was $13.5 million, net of cash acquired, and was funded with borrowings under the ABL Facility. The results of operations of Lentzcaping are reported within the Industrial Solutions segment for the period subsequent to the date of the acquisition.

The Lentzcaping transaction has been recorded using the acquisition method of accounting and accordingly, assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. The acquisition resulted in the recognition of $3.3 million in other intangible assets, consisting primarily of customer relationships and tradename. The customer relationships and tradename are finite-lived intangible assets that are expected to be amortized over periods of 15 years and 2 years, respectively. In addition, the acquisition resulted in the recognition of a $2.1 million intangible liability that will be amortized to operating expense over the 7-year contract term. The excess of the total consideration was recorded as goodwill, which is deductible for tax purposes. The fair values of the identifiable assets acquired and liabilities assumed were based on our estimates and assumptions using various market, income, and cost valuation approaches, which are classified within level 3 of the fair value hierarchy.

The following table summarizes the preliminary amounts recognized for the assets acquired and liabilities assumed as of the December 17, 2021 acquisition date.


(In thousands)
Receivables	$	2,807
Intangible assets	3,330
Property, plant and equipment	4,765
Other assets	346
Total assets acquired	11,248

Intangible liability	2,065
Other liabilities	604
Total liabilities assumed	2,669

Net assets purchased	8,579
Goodwill	4,871
Total purchase consideration	13,450

Net cash conveyed at closing	13,434
Due to seller	16
Total purchase consideration	$	13,450

In October 2019, we completed the acquisition of Cleansorb Limited (“Cleansorb”), a U.K. based provider of specialty chemicals for the oil and natural gas industry, which further expanded our completion fluids technology portfolio and capabilities. The purchase price for this acquisition was $18.7 million, net of cash acquired, and was funded with borrowings under the ABL Facility. The results of operations of Cleansorb are reported within the Fluids Systems segment for the period subsequent to the date of the acquisition.

Results of operations and pro-forma combined results of operations for these acquired businesses have not been presented as the effect of these acquisitions are not material to our consolidated financial statements.