ESR AR 2019 EN

Notes to the Consolidated Financial Statements 31 December 2019 210 Focused 34. BUSINESS COMBINATION (continued) (b) On 28 June 2019, the Group has, through its wholly-owned subsidiary Infinitysub Pte. Ltd., completed the acquisition of additional 51% interest in SIP Group. The Group previously held effective interest of 42.8% in SIP Group through a subsidiary and accounted as investment in associates (note 16). Upon acquisition of the additional 51% interest, SIP Group became a subsidiary of the Group. The acquisition of SIP Group was identified as a business combination by the management. SIP Group is a fully operational company as at the acquisition date and its principal activity is management services in Singapore. The fair values of the identifiable assets and liabilities of SIP Group as at the date of acquisition were as follows: Note Fair value recognised on acquisition date USD’000 Property, plant and equipment 14 Right-of-use assets 284 Other intangible assets 15,364 Financial assets at fair value through other comprehensive income 13,861 Other non-current assets 54 Deferred tax assets 4 Prepayments, other receivables and other assets 1,089 Cash and bank balances 3,517 Deferred tax liabilities (2,619) Trade payables, accruals and other payables (11,345) Lease liabilities (285) Total identifiable net assets at fair value 19,938 Non-controlling interests (798) Goodwill on acquisition 20 13,570 32,710 Satisfied by: Cash 18,253 Investment in associate remeasured at fair value at acquisition date 14,457 32,710 None of the goodwill recognised is expected to be deductible for income tax purposes. An analysis of the cash flows in respect of the acquisition of a subsidiary is as follows: USD’000 Cash consideration (18,253) Cash and bank balances acquired 3,517 Net outflow of cash and cash equivalents included in cash flows used in investing activities (14,736) Since the acquisition, SIP contributed USD2,490,000 to the Group’s revenue and USD892,000 profit to the consolidated profit for the year. Had the combination taken place at the beginning of the year, the revenue from continuing operations of the Group and the profit of the Group for the year would have been USD360,679,000 and USD279,080,000, respectively.