Business Context and Reporting Period
This Form 8-K Current Report, dated July 31, 2015, covers Greenpro Capital Corp. (GRNQ), a Nevada corporation. The filing reports the completion of a material acquisition on July 31, 2015, involving the purchase of 100% of the issued and outstanding securities of Greenpro Resources Limited (GRBV), a British Virgin Islands corporation.
Key Financial Metrics and Transaction Details
The acquisition was executed via a Sale and Purchase Agreement dated July 28, 2015. The aggregate purchase price was US$3,200,000, structured as follows:
- Stock Consideration: 9,070,000 restricted shares of GRNQ common stock, valued at US$3,174,500 (based on a $0.35 per share average closing price over the six trading days preceding July 28, 2015).
- Cash Consideration: US$25,500.
The filing does not provide specific revenue, profit, cash flow, margin, debt, or liquidity metrics for the reporting period or the acquired entity within this text. Financial statements and pro forma information are scheduled to be filed by amendment within 71 calendar days.
Material Changes and Related Party Transactions
The primary material change is the expansion of GRNQ's operations through the acquisition of GRBV. GRBV provides corporate and business advisory services and operates income-producing real estate through subsidiaries in Hong Kong, Malaysia, China, and Belize.
Related Party Transaction: The acquisition involves significant related party interests:
- Lee Chong Kuang: CEO, President, and Director of both GRNQ and GRBV. He holds 44.6% of GRNQ and 50% of GRBV.
- Gilbert Loke Che Chan: CFO, Secretary, Treasurer, and Director of both GRNQ and GRBV. He holds 44.6% of GRNQ and 50% of GRBV.
- Upon consummation, Messrs. Lee and Loke received the cash and stock consideration described above.
Outlook, Risks, and Contingencies
Management states the expectation that the acquired entities will broaden the range of services offered and diversify revenue sources. The filing notes that the purchase price was determined based on the existing business value of GRBV, the carrying value of its properties, brand names, and the settlement of the founder's initial investment.
Contingencies: The filing explicitly states that required financial statements of the business acquired and pro forma financial information are not included in this report and will be filed later. Investors should note the absence of immediate audited financial data for the acquired entity.
Key Facts for Investor Verification
- Verify the upcoming filing of financial statements and pro forma information within 71 days to assess the financial health of GRBV.
- Confirm the valuation methodology used for the $3.2 million purchase price, specifically regarding the "existing business value" and "carrying value" of properties.
- Review the related party transaction disclosures to understand the concentration of ownership and control between GRNQ and GRBV.
- Examine the specific assets held by GRBV subsidiaries, including real property in Malaysia and intellectual property in Hong Kong.