PRG Holdings Berhad Annual Report 2019

ANNUAL REPORT 2019 119 NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2019 cont’d 10. INVESTMENTS IN SUBSIDIARIES (continued) (a) Acquisition of subsidiaries (continued) (iii) The fair value of the assets acquired and the liabilities assumed from the acquisition of MGHL and its subsidiaries are as follows: Acquiree’s carrying amount Fair value recognised on acquisition RM’000 RM’000 Property, plant and equipment 1,176 1,176 Right-of-use assets 496 496 Inventories 4,217 4,217 Trade receivables 5,280 5,280 Other receivables, deposits and prepayments 6,582 6,582 Cash and bank balances 1,038 1,038 Trade payables (2,109) (2,109) Other payables, deposits and accruals (3,463) (3,463) Lease liabilities (500) (500) Current tax liabilities (1,497) (1,497) Net identifiable assets 11,220 Add: Goodwill 62,118 Add: Intangible assets 5,502 Add: Profit guarantee 2,593 Less: Deferred tax liabilities (1,248) Share consideration 80,185 Net cash inflow of the Group on acquisition 1,038 (iv) On 13 December 2019, PRG Healthcare Sdn. Bhd. (“PRG Healthcare”), a wholly-owned subsidiary of the Company had entered into a shares sale agreement with Bernard Chin Sze Piaw (“Dr Chin”) to acquire remaining 450 ordinary shares representing 45% of the issued and paid-up share capital of PRG Active Sdn. Bhd. (“PRGA”), which was a joint venture to the Group, from Dr Chin for a purchase consideration of RM1.00. Dr Chin had on 16 December 2019 resigned as a Director in PRGA and pursuant to that, PRG Healthcare has obtained control of PRGA. Consequently, the investment in PRGA had been transferred from investment in joint venture to investments in subsidiaries. The acquisition of the remaining 45% of the issued and paid-up share capital of PRGA is not completed as at the end of the financial year. The details of deemed disposal of the joint venture is disclosed in Note 12 to the financial statements. Goodwill on consolidation arising from the acquisition of PRGA of RM66,000 was accounted for using the acquisition method of accounting.