Knife River Corp

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Note 3 –Acquisitions

In 2024, we acquired the assets oftwo separate aggregate providers, one in Oregon andone in South Dakota. The acquisitions were considered asset purchases, therefore, the purchase price was allocated to the assets acquired based on their respective fair values and no goodwill was recognized. The aggregate purchase price for these transactions was $10.3 million.

In 2024, we completed four acquisitions which were accounted for as business combinations under ASC 805 - Business Combinations. The business combinations included operations that expanded our aggregates, ready-mix and liquid asphalt operations in our current geographic locations. The aggregate purchase price for these acquisitions totaled $120.7 million, subject to future post-closing adjustments. The results of these acquisitions have been included in our audited consolidated financial statements beginning on the acquisition dates. Pro forma financial amounts reflecting the effects of the business combinations are not presented, as none of these business combinations, individually or in the aggregate, were material to our financial position or results of operations.

The estimated fair value of the assets acquired and liabilities assumed are preliminary, as we continue to gather information to finalize the valuation of these assets and liabilities. The fair values are considered provisional until final fair values are determined, or the measurement period has passed. We expect to record adjustments as we accumulate the information needed to estimate the fair value of assets acquired and liabilities assumed, including working capital balances, estimated fair value of identifiable intangible assets, property, plant and equipment, total consideration and goodwill. We engaged a third-party valuation firm to assist us in the analysis of the fair value of Albina Asphalt. All estimates, key assumptions, and forecasts were either provided by or reviewed by management. While we chose to utilize a third-party valuation firm, the fair value analysis and related valuations represent the conclusions of management and not the conclusions or statements of any third party.

The excess of the total purchase price over the fair value of assets acquired and liabilities assumed was allocated to goodwill. We believe that the goodwill relates to several factors, including potential synergies related to market opportunities for multiple product offerings and economies of scale expected from combining our operations with thebusinesses acquired. See Note 7 for further information on the amount of goodwill recognized in each segment and the amortization periods of the intangible assets identified.

The final fair value of the net assets acquired may result in adjustments to the assets and liabilities, including goodwill, and will be made as soon as practical, but no later than one year from the respective acquisition dates. However, any subsequent measurement period adjustments are not expected to have a material impact on our results of operations.

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The preliminary allocation of the aggregate purchase price for these individually immaterial acquisitions during 2024 is as follows:

For the year ended December 31, 2024, we incurred acquisition costs of $7.7 million. These costs are included in selling, general and administrative expenses on the Consolidated Statement of Operations.