Business Combinations

12 Months Ended

Jul. 31, 2012

Business Combinations

C.Business combinations

Business combinations are accounted for under the purchase method and the assets acquired and liabilities assumed are recorded at their estimated fair market values as of the acquisition dates. The results of operations are included in the consolidated statements of earnings from the date of acquisition. The pro forma effect of these transactions was not material to Ferrellgas’ balance sheet or results of operations.

During fiscal 2012, Ferrellgas acquired propane distribution assets with an aggregate value of $14.0 million in the following transactions:

· Economy Propane, based in California, acquired September 2011;

· Federal Petroleum Company, based in Texas, acquired October 2011;

· Polar Gas Company, based in Wisconsin, acquired November 2011;

· Welch Propane, based in Texas, acquired November 2011; and

· Rio Grande Valley Gas, based in Texas, acquired January 2012.

During fiscal 2011, Ferrellgas acquired propane distribution assets with an aggregate value of $12.6 million in the following transactions:

· Beatty’s Gas, based in Pennsylvania, acquired October 2010;

· Kings River Propane, based in California, acquired December 2010;

· Bennett Gas Company, based in Georgia, acquired December 2010;

· Ram Propane, based in Wyoming, acquired March 2011; and

· Williams Panhandle Propane, based in Florida, acquired July 2011.

During fiscal 2010, Ferrellgas acquired propane distribution assets with an aggregate value of $45.1 million in the following transaction:

· Vanson, LLC, based in Michigan, acquired September 2009.

These acquisitions were funded as follows (in thousands):

	For the year ended July 31,
	2012		2011		2010
Cash payments	$	10,387	$	7,298	$	36,497
Issuance of liabilities and other costs and considerations		2,347		2,348		5,556
Common units, net of issuance costs		1,300		2,940		3,061
Aggregate fair value of transactions	$	14,034	$	12,586	$	45,114

The aggregate fair values of these transactions were allocated as follows:

		For the year ended July 31,
	2012		2011		2010
Customer tanks, buildings, land and other	$	7,454	$	7,746	$	14,707
Non-compete agreements		1,006		1,684		3,271
Goodwill		-		5		-
Customer lists		5,574		3,151		27,136
Aggregate fair value of transactions	$	14,034	$	12,586	$	45,114

The estimated fair values and useful lives of assets acquired during fiscal 2012 are based on a preliminary internal valuation and are subject to final valuation adjustments. Ferrellgas intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets and liabilities acquired.  The estimated fair values and useful lives of assets acquired during fiscal 2011 and 2010 are based on an internal valuation and included only minor adjustments during the 12 month period after the date of acquisition.

Ferrellgas, L.P. [Member]

Business Combinations

C.Business combinations

Business combinations are accounted for under the purchase method and the assets acquired and liabilities assumed are recorded at their estimated fair market values as of the acquisition dates. The results of operations are included in the consolidated statements of earnings from the date of acquisition. The pro forma effect of these transactions was not material to Ferrellgas, L.P.’s balance sheet or results of operations.

During fiscal 2012, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $14.0 million in the following transactions:

· Economy Propane, based in California, acquired September 2011;

· Federal Petroleum Company, based in Texas, acquired October 2011;

· Polar Gas Company, based in Wisconsin, acquired November 2011;

· Welch Propane, based in Texas, acquired November 2011; and

· Rio Grande Valley Gas, based in Texas, acquired January 2012.

During fiscal 2011, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $12.6 million in the following transactions:

· Beatty’s Gas, based in Pennsylvania, acquired October 2010;

· Kings River Propane, based in California, acquired December 2010;

· Bennett Gas Company, based in Georgia, acquired December 2010;

· Ram Propane, based in Wyoming, acquired March 2011; and

· Williams Panhandle Propane, based in Florida, acquired July 2011.

During fiscal 2010, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $45.1 million in the following transaction:

· Vanson, LLC, based in Michigan, acquired September 2009.

These acquisitions were funded as follows (in thousands):

	For the year ended July 31,
	2012		2011		2010
Cash payments	$	10,400	$	7,298	$	36,497
Issuance of liabilities and other costs and considerations		2,334		2,348		5,556
Contribution of net assets from Ferrellgas Partners		1,300		2,940		3,061
Aggregate fair value of transactions	$	14,034	$	12,586	$	45,114

The aggregate fair values of these transactions were allocated as follows:

		For the year ended July 31,
	2012		2011		2010
Customer tanks, buildings, land and other	$	7,454	$	7,746	$	14,707
Non-compete agreements		1,006		1,684		3,271
Goodwill		-		5		-
Customer lists		5,574		3,151		27,136
Aggregate fair value of transactions	$	14,034	$	12,586	$	45,114

The estimated fair values and useful lives of assets acquired during fiscal 2012 are based on a preliminary internalvaluation and are subject to final valuation adjustments. Ferrellgas, L.P. intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets andliabilities acquired. The estimated fair values and useful lives of assets acquired during fiscal 2011 and 2010 are based on an internal valuation and included only minor adjustments during the 12 month period after the date of acquisition.