Business Acquisition

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Business Acquisition [Text Block]

6. Business Acquisition

Effective May 24, 2019, the Company purchased all the issued and outstanding shares of 1684567. The acquisition was accounted for as a business combination using the acquisition method of accounting. The purchase price paid in the acquisition has been preliminarily allocated to record the assets acquired and liabilities assumed based on their estimated fair value. When determining the fair values of assets acquired and liabilities assumed, management made significant estimates. The transaction closed on May 28, 2019. The purchase consideration consisted of cash from working capital of $209,952 ($282,308 CAD) and cash from a third-party mortgage obtained in the amount of $1,258,273 ($1,691,910 CAD, net of financing fees of $80,387 ($108,090 CAD)). The total purchase price includes the original offer of $1,314,304 ($1,767,250 CAD) and acquisition costs of $153,922 ($206,968 CAD).

The allocation of the purchase price is as follows:

 

			May 24, 2019
Purchase consideration
Cash	($1,974,218 CAD)	$	1,468,225
Assets acquired
	Accounts receivable ($ 7,573 CAD)		5,632
	Land ($1,850,892 CAD)		1,376,508
	Automotive equipment and machinery ($16,525 CAD)		12,290
	Customer list ($10,205 CAD)		7,589
	Environmental compliance approval ($100,000 CAD)		74,370
Liabilities assumed
	Accounts payable ($10,977 CAD)		8,164
Net assets acquired ($1,974,218 CAD)		$	1,468,225