Wah Seong Corporation Berhad Annual Report 2020

141 ANNUAL REPORT 2020 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020 10 INVESTMENT IN ASSOCIATES (CONTINUED) Sensitivity As at 31 December 2020, the recoverable amounts of the investment in an associate is estimated to exceed the carrying amount. The recoverable amount of the investment would equal its carrying amount if the key assumptions were to change as follows: 2020 From To Pre-tax discount rate 15.0% 16.2% Growth rate for terminal value 2.0% 0.7% There are no reasonably possible changes in the key assumptions that would have changed the carrying amount of the investment. Details of associates are as follows: Country of incorporation Group’s effective interest Principal activities 2020 % 2019 % WS Integrasi Sdn. Bhd. Malaysia 49 49 Trading, distribution, sales and marketing of the Group’s product and services in the oil & gas, renewable energy, engineering, industrial and property (including land acquisitions) industries as well as undertaking other external business services opportunities Petra Energy Berhad Malaysia 27 27 Investment holding Evraz Wasco Pipe Protection Corporation Canada 49 49 Provision of pipe coating services Syarikat Beka Sdn. Bhd. Malaysia 48 48 Dormant Wah Seong Boustead Company Limited Myanmar 50 50 Property development, trading and provision of auxiliary services Spirolite (M) Sendirian Berhad Malaysia 30 a - Manufacturing and trading of spiral pipes, straight pipes, tubes, tanks and containers a On 13 August 2020, Syn Tai Hung Trading Sdn. Bhd. (“STHT”), an indirect wholly-owned subsidiary of the Company, had diluted its 100% equity interest held to 30% by disposing 3,622,990 ordinary shares, representing 70% of equity interest in Spirolite (M) Sendirian Berhad (“Spirolite Malaysia”) for a total cash consideration of RM30,369,000. As a result, Spirolite Malaysia and its subsidiaries namely Spirolite Marketing Sdn. Bhd. and Spirolite (Myanmar) Company Limited ceased to be subsidiaries and became associates of STHT and the Company accordingly. Refer to Note 37(b) for further details.