ENRA Group Berhad Annual Report 2019

89 ENRA GROUP BERHAD ∞ Annual Report 2019 page Notes to the Financial Statement 31 March 2019 7. INVESTMENTS IN SUBSIDIARIES (cont’d) (c) Acquisition/Incorporation of subsidiaries and subscription of shares in subsidiaries (cont’d) (ii) Acquisition of International Chemicals Engineering Pty Ltd (“ICE”) (cont’d) The fair value of the contingent consideration arrangement of RM4,522,000 was estimated by applying income approach. The fair value estimates are based on assumed discount rate of 9.31% and assumed that ICE will achieved its profit target for the three financial years. ICE is the supplier of liquid odorant, dosing systems and servicing to gas delivery and storage systems. In the eight months to 31 March 2019, ICE contributed the revenue of RM8,998,000 and profit of RM1,043,000. If the acquisition had been occurred on 1 April 2018, management estimates that consolidated revenue RM169,205,000 and consolidated loss for the financial year would have been RM26,275,000. In determining these amounts, management has assumed that the fair value adjustments, determined provisionally, that arouse on the date of acquisition would have been the same if the acquisition had occurred on 1 April 2018. (iii) Subscription of shares in ENRA Energy Sdn. Bhd. (“EESB”) On 24 December 2018, the Company has subscribed for an additional 7,500,000 ordinary shares at a total consideration of RM7,500,000 in EESB by way of capitalising of amount owing by EESB to the Company. (iv) Subscription of shares in ENRA Kimia Sdn. Bhd. (“EKSB”) On 24 December 2018, EESB has subscribed for an additional 7,500,000 ordinary shares at a total consideration of RM7,500,000 in EKSB by way of capitalising of amount owing by EKSB to EESB. (v) Acquisition of Abode Senior Living Ltd (“ASLL”) On 27 March 2019, ENRA Property (UK) Ltd (“EPUK”), a wholly-owned indirect subsidiary of the Company, had entered into a Shareholders’ Agreement to acquire a controlling 51% stake in ASLL. EPUK will pay a cash consideration of £51 for its subscription of 51 new ordinary shares in ASLL. ASLL has two wholly-owned subsidiaries; Abode Caldecott Square Development Ltd (“ACSD”) and Caldecott Square Rugby Ltd (“CSR”). ASLL Group will carry out a property development project on its freehold land into a retirement home living estate in Rugby, Warwickshire, the United Kingdom. The acquisition of ASLL has no material impact to the Group’s revenue and profit for the year.  (vi) Acquisition of ENRA IOL Sdn. Bhd. (“EIOL”) On 27 March 2019, ENRA Engineering And Fabrication Sdn. Bhd. (“EEFAB”), a wholly-owned indirect subsidiary of the Company, has acquired 51% equity interest in EIOL by way of subscription and allotment of new 510,000 ordinary shares for a total cash consideration of RM1,000,000. The acquisition of EIOL has no material impact to the Group’s revenue and profit for the year.