Discontinued Operations

3 Months Ended

Mar. 28, 2020

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

On February 28, 2020, the Company completed the sale of S&D to Westrock Coffee Company, LLC, a Delaware limited liability company (“Westrock”), pursuant to which Westrock acquired all of the issued and outstanding equity of S&D from the Company (“S&D Divestiture”). The aggregate deal consideration was $405.0 million, paid at closing in cash, subject to adjustment for indebtedness, working capital and other customary post-closing adjustments.

The Company used the proceeds of the S&D Divestiture to finance a portion of the Legacy Primo Acquisition. See Note 5 to the Consolidated Financial Statements for additional information on the Legacy Primo Acquisition.

The major components of net income from discontinued operations, net of income taxes in the accompanying Consolidated Statements of Operations include the following:

	For the Three Months Ended
(in millions of U.S. dollars)	March 28, 2020		March 30, 2019
Revenue, net 1	$	97.1	$	148.0
Cost of sales	71.1		108.2
Operating (loss) income from discontinued operations	(0.5)		3.4
Gain on sale of discontinued operations	60.5		—
Net income from discontinued operations, before income taxes	59.8		3.4
Income tax expense 2	28.9		0.4
Net income from discontinued operations, net of income taxes	$	30.9	$	3.0

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¹ Includes $1.0 million and $1.6 million of related party sales to continuing operations for the three months ended March 28, 2020 and March 30, 2019, respectively.

² The S&D Divestiture resulted in tax expense on the gain on sale of $28.5 million and will utilize a significant portion of the existing U.S. net operating loss carry forwards.