BUSINESS COMBINATION

12 Months Ended

Dec. 31, 2025

BUSINESS COMBINATION [Abstract]

BUSINESS COMBINATION

NOTE 3 – BUSINESS COMBINATION

Acquisition of Hangzhou Hezhe’s equity interest

On June 23, 2021, the Company invested RMB2,000,000 (approximately $273,999) in Hangzhou Hezhe to acquire 20% of its equity interest. On May 8, 2024, the Company entered into a new equity investing agreement to acquire another 60% of Hangzhou Hezhe’s equity interest, with the cash consideration amounted to RMB3,704,307 (approximately $511,638), and the share transfer was completed on May 21, 2024. The fair value of previously held equity interest is RMB1,234,769 (approximately $170,546) at the acquisition date. As of December 31, 2024, the Company held 80% of equity interest in Hangzhou Hezhe in total.

The transaction constitutes a business combination for accounting purposes and is accounted for using the acquisition method under ASC 805. Cenntro Inc. is deemed to be the accounting acquirer and the assets and liabilities of Hangzhou Hezhe are recorded at the fair value as of the date of the closing. The Company completed the valuations necessary to assess the fair value of the acquired assets and liabilities and the non-controlling interests with the assistance from an independent valuation firm, resulting from which the amounts of goodwill were determined and recognized as of the respective acquisition dates. Loss of $149,872 from this acquisition was recognized for the year ended December 31, 2024 due to the difference between the carrying value of the equity method investment and its fair value as at the closing date.

The following was a summary of the fair values of the assets acquired and liabilities assumed. RMB: USD exchange rate of 7.2401 as of April 30, 2024 was applied:

	As of May 21, 2024
	RMB			USD			Amortization Period
Current assets (1)		7,592,974			1,048,739
Property and equipment		1,383,600			191,102		3 - 10 years
Goodwill		48,514			6,701
Current liabilities		(2,822,703	)		(389,871	)
Deferred tax liabilities		(28,539	)		(3,941	)
Noncontrolling interest		(1,234,769	)		(170,546	)
Total		4,939,077			682,184

(1) Current assets acquired primarily included cash and cash equivalent of $156,237, inventories of $887,447 and other current assets of $5,055.