Business Acquisition

12 Months Ended

Dec. 31, 2012

Business Combinations [Abstract]

Business Acquisition

Business Acquisitions

The Company's acquisitions are accounted for as purchases in accordance with ASC Topic 805, Business Combinations. Tangible assets and liabilities and identifiable intangible assets were adjusted to fair values at acquisition date with the remainder of the purchase price, if any, recorded as goodwill. Operating results of these acquisitions are included in the Company's Consolidated Financial Statements from the date of acquisition and are not significant to the Company's consolidated operating results.

2012 Acquisitions

The year-to-date spending on acquisition of businesses, net of cash acquired is $220.3 million.

On December 3, 2012, the Company completed the purchase a majority of the grain and agronomy assets of Green Plains Grain Company ("GPG"), a subsidiary of Green Plains Renewable Energy, Inc. for a purchase price of $120.2 million, which includes a $3.3 million payable to the acquiree that was outstanding as of year end and paid in January 2013. The various facilities located in Iowa and Tennessee have a combined grain storage capacity of more than 32 million bushels and 12,000 tons of nutrient storage.

The purchase price allocation is preliminary, pending completion of the full valuation report; however significant changes are not anticipated. The summarized preliminary purchase price allocation is as follows:

(in thousands)
Accounts receivable	$	19,174
Inventory	121,983
Property, plant and equipment	57,963
Intangible assets	7,200
Goodwill	30,206
Commodity derivatives	4,701
Other assets	1,775
Accounts payable	(91,001		)
Debt assumed	(29,632		)
Other liabilities	(2,136		)
Total purchase price	$	120,233

The goodwill recognized as a result of the GPG acquisition is $30.2 million, for which the full amount is deductible for tax purposes, and is included in the Grain reportable segment. The goodwill relates to the value of a fully functional business consisting of a successful management team and an experienced and talented work force.

Details of the intangible assets acquired are as follows:

(in thousands)	Fair Value		Useful Life
Supplier relationships	$	4,300	3 to 5 years
Customer relationships	2,900		10 years
Total identifiable intangible assets	$	7,200	6 years *

*weighted average number of years

The above amounts represent the preliminary allocation of purchase price, which will include the allocation to reportable segments, and are subject to revision when appraisals are finalized.

The amounts of the GPG revenue and earnings included in the Consolidated Statements of Income for the year ended December 31, 2012, and the revenue and earnings of GPG had the acquisition date been January 1, 2011 are as follows:

(unaudited, in thousands)	Revenue		Operating Income (Loss)
Actual from 12/3/2012 to 12/31/2012	$	40,477	$	(785	)
Supplemental pro forma from 1/1/2012 - 12/31/2012	566,821		1,632
Combined entity pro forma from 1/1/2012 - 12/31/2012	5,798,354		122,550
Supplemental pro forma from 1/1/2011 - 12/31/2011	585,572		1,430
Combined entity pro forma from 1/1/2011 - 12/31/2011	5,161,903		149,308

On October 30, 2012, the Company completed the purchase of substantially all of the assets of Mt. Pulaski Products for a purchase price of $10.7 million. The operations consist of several corncob processing facilities in central Illinois.

The purchase price allocation is preliminary, pending completion of the full valuation report; however significant changes are not anticipated. The summarized preliminary purchase price allocation is as follows:

(in thousands)
Inventory	$	3,757
Intangible assets	1,000
Goodwill	1,985
Property, plant and equipment	3,941
Total purchase price	$	10,683

The goodwill recogized as a result of the Mt. Pulaski acquisition is $2.0 million, for which the full amount is deductible for tax purposes, and is included in the Turf & Specialty reportable segment. The goodwill relates to expected synergies from combining operations as well as an assembled workforce.

Details of the intangible assets acquired are as follows:

(in thousands)	Fair Value		Useful Life
Trademark	$	300	Indefinite
Customer list	600		10 years
Noncompete agreement	100		7 years
Total identifiable intangible assets	$	1,000	10 years *

*weighted average number of years

On May 1, 2012, the Company and its subsidiary, The Andersons Denison Ethanol LLC ("TADE") completed the purchase of certain assets of an ethanol production facility in Denison, Iowa for a purchase price of $77.4 million. Previously owned by Amaizing Energy Denison LLC and Amaizing Energy Holding Company, LLC, the operations consist of a 55 million gallon capacity ethanol facility with an adjacent 2.7 million bushel grain terminal, with direct access to two Class 1 railroads in Iowa. TADE has been organized to provide investment opportunity for the Company and potential outside investors. The Company owns the grain terminal, manages TADE, and provides grain origination, risk management, and DDG and ethanol marketing services. The Company currently owns a controlling interest of 85% of TADE, and therefore includes TADE's results of operations in its consolidated financial statements. The fair value of the noncontrolling interest in TADE purchased by the minority investor at the acquisition date was $6.1 million.

The summarized purchase price allocation is as follows:

(in thousands)
Grain elevator	$	14,285
Inventory	10,087
Intangible assets	2,373
Other current assets	962
Property, plant and equipment	49,693
Total purchase price	$	77,400

Details of the intangible assets acquired are as follows:

(in thousands)	Fair Value		Useful Life
Lease intangibles	$	2,123	10 months to 5 years
Noncompete agreement	250		2 years
Total identifiable intangible assets	$	2,373	3 years *

*weighted average number of years

On January 31, 2012, the Company purchased 100% of the stock of New Eezy Gro, Inc. (“NEG”) for a purchase price of $16.8 million. New Eezy Gro is a manufacturer and wholesale marketer of specialty agricultural nutrients and industrial products.

The summarized purchase price allocation is as follows:

(in thousands)
Current assets	$	5,106
Intangible assets	9,600
Goodwill	6,681
Property, plant and equipment	3,586
Current liabilities	(3,784		)
Deferred tax liability, net	(4,412		)
Total purchase price	$	16,777

The goodwill recognized as a result of the NEG acquisition is $6.7 million and is included in the Plant Nutrient reportable segment. The goodwill relates to the value of proprietary products and processes as well as an assembled workforce.

Details of the intangible assets acquired are as follows:

(in thousands)	Fair Value		Useful Life
Trademarks	$	1,200	10 years
Customer list	5,500		10 years
Technology	2,100		5 years
Noncompete agreement	800		7 years
Total identifiable intangible assets	$	9,600	9 years *

*weighted average number of years

2011 Acquisitions

On October 31, 2011, the Company completed the purchase of Immokalee Farmers Supply, Inc., which serves the specialty vegetable producers in Southwest Florida, for a total purchase price of $3.0 million, which included a $0.6 million payable recorded in other long-term liabilities and is based on future performance of the acquired company.