The financial statements of the Company consolidate the accounts of AKITA Drilling Ltd. and its subsidiaries.
All inter-company transactions, balances and unrealized gains and losses from inter-company transactions are
eliminated on consolidation.
Subsidiaries are entities over which the Company has control. The Company controls an entity when the
Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability
to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on
which control is transferred to the Company and are deconsolidated from the date that control ceases.
price. The Company used the additional proceeds from the issuance of AK Holding common stock to repay a portion of
outstanding borrowings under its asset-backed revolving credit facility (“Credit Facility”) and for general corporate purposes. For
the year ended December 31, 2014, the Company incurred acquisition costs of $8.1. Acquisition costs are primarily comprised of
transaction fees and direct costs, including legal, finance, consulting and other professional fees, and are included in selling and
administrative expenses. In addition, the Company incurred $12.6 of costs in the year ended December 31, 2014 for committed
bridge financing that the Company arranged in connection with the acquisition of Dearborn, but which was unused because of the
Company’s successful financing of the acquisition through the debt and common stock offerings discussed above. As a result,
these costs were expensed in 2014 and are included in other income (expense). Subsequent to the acquisition, the Company
incurred severance costs of $2.6 for certain employees of Dearborn, which are included in selling and administrative expenses for
the year ended December 31, 2014, and an income tax charge of $8.4 related to changes in the value of deferred tax assets resulting
from the acquisition