Annual report pursuant to Section 13 and 15(d)

Dispositions Dispositions

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Dispositions Dispositions
 12 Months Ended
Dec. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]  
Disposal groups, excluding discountined operations
8. Dispositions:
Sale of Product Line
On June 28, 2019, the Company completed the sale of a portion of its sulfate salts product line within its Performance Chemicals segment for $28,000, with net cash consideration of $27,658 and a pre-tax gain on sale of $11,518. The transaction was recorded as an asset sale, with the gain on disposition included in the other operating expense, net line item in the Company’s consolidated statement of income for the year ended December 31, 2019 (see Note 9 to these consolidated financial statements for additional details). At the time of disposition, the carrying value of the Company’s net working capital related to this non-core product line was $4,215. In addition to the net working capital sold as part of the transaction, the Company also derecognized $3,276 of property, plant and equipment related to the product line and allocated $9,000 of the consideration received to a liability for deferred revenue.
Concurrent with the product line sale, the Company entered into a tolling arrangement with the buyer in which the Company will use its existing manufacturing facilities for the product line to manufacture the product for the buyer, the majority of which runs until June 2021. The Company deferred $9,000 of the consideration received as a liability, to be recognized as the Company executes its performance obligations over the term of the contractual agreement with the buyer. Additionally, the Company concluded that an embedded lease arrangement exists as a result of the combination of the sale and tolling agreements. Given the ability of the buyer to control substantially all of the output of the facilities and the existence of bargain purchase options on the manufacturing assets, the Company determined that the buyer is effectively leasing the assets from the Company and derecognized the associated property, plant and equipment under a sales-type leasing arrangement. The gain on the sale of fixed assets is included as part of the Company’s overall gain on sale related to the transaction, with the Company’s net investment in the leased assets having been settled as part of the consideration received in the transaction with no additional future cash flows to be recognized on the lease.
Sale of Assets
On December 19, 2019, the Company completed the sale of real property for $19,100, with net cash consideration of $17,100 and a holdback receivable to be settled by December 2021 of $1,000, and recorded a pre-tax gain on sale of $7,150. On December 30, 2019, the Company entered into a leaseback arrangement with the buyer-lessor which expires in December 2021. The Company recorded the asset sale separately from the leaseback, with the gain on disposition included in the other operating expense, net line item in the Company’s consolidated statement of income for the year ended December 31, 2019 (see Note 9 to these consolidated financial statements for additional details).
At the time of disposition, the Company derecognized $10,735 of property, plant and equipment and accounted for the leased asset as an operating lease. A right-of-use lease asset of $3,588 and lease liability of $3,524 was recorded at December 31, 2019, based on the present value of the lease payments and future demolition costs associated with the lease.