DISPOSAL OF SUBSIDIARY

9 Months Ended

Sep. 30, 2024

Discontinued Operations and Disposal Groups [Abstract]

DISPOSAL OF SUBSIDIARY

NOTE 4 — DISPOSAL OF SUBSIDIARY

Cellpro Japan Co., Ltd.

On January 1, 2024, the Company disposed of its subsidiary, Cellpro Japan Co., Ltd. (“Cellpro”), to Waqoo Inc. (“Waqoo”), a Japanese company listed on the Tokyo Stock Exchange, of which the CEO of the Company is a non-controlling shareholder with more than 10% ownership interest, in exchange for 353,600 shares of Waqoo’s common stock through a share exchange agreement. The disposal of Cellpro did not constitute a strategic shift that would have a major effect on the Company’s operations and financial results.

After the stock exchange, SBC Japan became a shareholder with less than 10% ownership interest of Waqoo. The common stock of Waqoo was recorded as an investment in a public entity with readily determinable fair value, which was included in long-term investments. Also see Note 9 for further details.

The following table summarizes the assets and liabilities disposed of at the disposal date.

Cash and cash equivalents	$	815,819
Accounts receivable		307,127
Accounts receivable – related parties		146,857
Inventories		244,440
Prepaid expense and other current assets		8,115
Property and equipment, net		300,779
Intangible assets, net		2,249,706
Other assets		84,763
Accounts payable		(191,343	)
Current portion of long-term loans		(28,418	)
Income tax payable		(99,266	)
Accrued liabilities and other current liabilities		(175,012	)
Long-term loans		(260,978	)
Deferred tax liabilities		(776,249	)
Net assets of the subsidiary		2,626,340
Non-controlling interest of the subsidiary		(1,221,795	)
Net assets of the subsidiary attributable to the Company		1,404,545
Reclassification of accumulated translation adjustment into gain on disposal		347,784
Fair value of consideration received – Waqoo’s common stock		5,565,938
Gain on disposal of subsidiary	$	3,813,609

SBC MEDICAL GROUP HOLDINGS INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS