Ayala acquires Phinma Energy

The Ayala group is ramping up its energy business by acquiring a 51.48-

percent stake in Phinma Energy Corp., to help reach its renewables goals.
OBJECTIVES:
a. Determine whether the business combination is a purchase of net assets
or purchase of stocks.
AC Energy purchased a total of 3.67 billion shares for P3.42 billion
b. Determine the consideration given up – cash, noncash, debt or equity
securities including contingent consideration, if any.
AC ENERGY, Inc. is taking control of Phinma Energy Corp. through a
“mutually strategic agreement” that gives the Ayala-led company a 51.48%
stake in the listed energy firm for P3.42 billion.
c. Determine whether the combination resulted to goodwill or gain and the
amounts.
Consideration Transferred 3,420,000,000
Add: NCI
Total:
Less: Fair value of the identifiable net assets acquired
Goodwill

d. In stock acquisition business combination, determine the option used to

measure, at initial recognition, any NCI.
Non-Controlling Interest is measured at proportionate fair value of
acquiree’s net assets