Subsidiaries acquired

Principal Activity

Date of
Acquisition

Proportion of
Voting Equity
Interests
Acquired (%)

Consideration Transferred

NT$

US$ (Note 4)

AMPI

Engaged in the manufacturing of integrated circuit

April 30, 2019

50.97

$ 250,000

ASEEE

Engaged in the production of embedded substrate

April 26, 2019

51.00

$ —

USIPL

Engaged in the design and manufacturing of electronic components and new electronic applications

October 31, 2019

60.00

$ 313,057

FAFG

Holding company and the group engaged in the design and manufacturing of electronic components

December 1, 2020

100.00

$ 12,443,637

ITGEU

Trading company

October 21, 2021

100.00

$ 50,368

$ 1,816

SER

Engaged in the design and manufacturing of electronic components

November 2, 2021

100.00

$ 217,919

$ 7,856

Consideration Transferred


	AMPI		ASEEE		USIPL		FAFG (Retrospectively Adjusted)			ITGEU				SER
	NT$		NT$		NT$		NT$			NT$		US$ (Note 4)		NT$		US$ (Note 4)

Cash	$	250,000	$	—	$	313,057	$	11,094,802		$	50,368	$	1,816	$	217,919	$	7,856
Equity instrument issued		—		—		—		1,734,570			—		—		—		—
Contingent consideration arrangement		—		—		—		(385,735	)		—		—		—		—


Fair value of identifiable net assets acquired	$	250,000	$	—	$	313,057	$	12,443,637		$	50,368	$	1,816	$	217,919	$	7,856

In April 2019, the Group’s subsidiary, ASE Test, Inc., subscribed for 100,000 thousand ordinary shares of AMPI from its private placement with NT$250,000 thousand in cash. The percentage of the Group’s ownership in AMPI then increased to 50.97% and, therefore, the Group obtained control over AMPI. The investment in ordinary shares of AMPI originally accounted for using the equity method was remeasured to the fair value at the acquisition date and the Group recognized remeasurement gain of NT$243,057 thousand under the line item of other gains and losses.

In April 2019, ASE entered into a memorandum of understanding with TDK Corporation (“TDK”) in relation to ASEEE that was incorporated by a joint venture agreement entered into by the Group and TDK. In addition to a reduction of one legal representative director of TDK, which resulted in that the Group obtained control over ASEEE starting from April 2019 and the investments in ASEEE originally accounted for using the equity method was remeasured to its fair value at the acquisition date with a remeasurement gain of NT$76,655 thousand under the line item of other gains and losses (Note 25), the memorandum of understanding set out that, after ASEEE offset its accumulated deficits against its capital in an amount of NT$1,147,595 thousand, ASE subscribed all of 150,000 thousand ordinary shares newly issued by ASEEE through its capital increase by cash in an amount of NT$1,500,000 thousand in May 2019 and then repurchased all of ASEEE’s ordinary shares held by TDK in an amount of US$6,000 thousand in July 2019. As a result, the Group eventually held 100% of ownership in ASEEE (Note 31). Furthermore, ASE merged ASEEE in February 2020.

In October 2019, the Group’s subsidiary, Universal Global Electronics Co., Ltd., acquired 60% shareholdings of USIPL with a total consideration based on independent professional appraisal reports.

In December 2020, the Group’s subsidiary, USIFR, paid NT$10,800,558 thousand (equivalent to US$368,753 thousand) in cash and the Group’s subsidiary, USISH, issued its 25,940 thousand new ordinary shares, respectively, to acquire 100% shareholdings of FAFG. In addition, according to the share purchase agreement, USIFR is obliged to pay an

earn-out

amount up to US$42,805 thousand in 2023 if FAFG’s net profit in 2021 and 2022 reaches the predetermined target. In December 2020, USIFR deposited NT$294,244 thousand (equivalent to US$10,122 thousand) in advance to trust account. Based

on the valuation report of fair

value of contingent consideration, USIFR will be able to receive NT$385,735 thousand back, of which NT$294,244 thousand will be received from trust account while NT$91,491 thousand will be received additionally.

In November 2021, the Group’s subsidiary, ASTEELFLASH FRANCE, acquired 100% shareholdings of SER

and o

btain

control over SER. In November 2021, the board of directors of ASTEELFLASH FRANCE further resolved to merge SER

December 28,

202

was

the

record date for the merger and such merger was completed.

Assets acquired and liabilities assumed at the date of acquisition


	AMPI			ASEEE			USIPL			FAFG			ITGEU						SER
	NT$			NT$			NT$			NT$			NT$			US$ (Note 4)			NT$			US$ (Note 4)

Assets
Cash and cash equivalents	$	349,496		$	23,197		$	108,718		$	2,349,164		$	68,719		$	2,477		$	18,850		$	680
Trade and other receivables		371,144			5,732			58,713			4,434,296			41,832			1,508			40,671			1,466
Inventories		403,887			11,033			229			4,836,819			—			—			375,912			13,551
Property, plant and equipment		683,207			1,361,572			525,048			2,882,720			94			3			37,672			1,357
Intangible assets		128,900			290,757			11,704			1,541,155			32			1			368			14
Others		237,766			317,888			99,112			1,919,118			2,828			102			186,377			6,719
Liabilities
Trade and other payables		(224,295	)		(133,278	)		(217,887	)		(4,575,720	)		(29,165	)		(1,051	)		(214,883	)		(7,746	)
Borrowings and bonds payables		(951,519	)		(1,371,395	)		(190,737	)		(356,417	)		—			—			—			—
Others		(148,723	)		(290,273	)		(63,708	)		(3,155,051	)		(858	)		(31	)		(227,048	)		(8,185	)


Fair value of identifiable net assets acquired	$	849,863		$	215,233		$	331,192		$	9,876,084		$	83,482		$	3,009		$	217,919		$	7,856

A call option on the remaining 40%

non-controlling

interests of USIPL was stipulated in the equity transfer agreement. The Group recognized the call option under the line item of financial assets at FVTPL and exercised it in June 2020 (Note 31).

Non-controlling

interest

Non-controlling interests of AMPI and ASEEE were measured at their proportionate share of their fair value of AMPI’s and ASEEE’s identifiable net assets, respectively.

Non-controlling interests of USIPL were measured at fair value at the acquisition date by using market approach incorporating transaction prices of comparable companies and the discount rate for lack of control. The significant unobservable inputs is the discount rate for lack of control of 31%.

Non-controlling

interests of FAFG were measured at its proportionate share of the fair value of FAFG’s identifiable net assets.

Goodwill recognized on acquisitions or gain recognized in bargain purchase transaction


	AMPI			ASEEE			USIPL			FAFG			ITGEU						SER
	NT$			NT$			NT$			NT$			NT$			US$ (Note 4)			NT$			US$ (Note 4)

Consideration transferred	$	250,000		$	—		$	313,057		$	12,443,637		$	50,368		$	1,816		$	217,919		$	7,856
Add: Fair value of investments previously owned		315,925			117,609			—			—			—			—			—			—
Add: Non-controlling interests		416,716			105,464			142,494			289			—			—			—			—
Less: Fair value of identifiable net assets acquired		(849,863	)		(215,233	)		(331,192	)		(9,876,084	)		(83,482	)		(3,009	)		(217,919	)		(7,856	)


Goodwill recognized on acquisition (gain recognized in bargain purchase transaction)	$	132,778		$	7,840		$	124,359		$	2,567,842		$	(33,114	)	$	(1,193	)	$	—		$	—

The goodwill from acquisitions mainly represents the control premium. In addition, the consideration paid for acquisitions effectively included amounts attributed to the benefits of expected synergies, such as revenue growth and future market expansions. These benefits are not recognized separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets.

The goodwill recognized on acquisitions is not expected to be deductible for tax purpose.

Net cash outflow (inflow) on acquisition of subsidiaries


	AMPI			ASEEE			USIPL			FAFG			ITGEU						SER
	NT$			NT$			NT$			NT$			NT$			US$ (Note 4)			NT$			US$ (Note 4)

Consideration transferred	$	250,000		$	—		$	313,057		$	11,094,802		$	50,368		$	1,816		$	217,919		$	7,856
Less: Cash and cash equivalent acquired		(349,496	)		(23,197	)		(108,718	)		(2,349,164	)		(68,719	)		(2,477	)		(18,850	)		(680	)


Net cash outflow (inflow) on acquisition of subsidiaries	$	(99,496	)	$	(23,197	)	$	204,339		$	8,745,638		$	(18,351	)	$	(661	)	$	199,069		$	7,176

Impact of acquisitions on the results of the Group

The results of operations since the acquisition date were included in the consolidated statements of comprehensive income and were as follows:


	AMPI (for the period from April 30, 2019 through December 31, 2019)			ASEEE (for the period from April 26, 2019 through December 31, 2019)			USIPL (for the period from October 31, 2019 through December 31, 2019)			FAFG (for the period from December 1, 2020 through December 31, 2020)		ITGEU (for the period from October 21, 2021 through December 31, 2021)						SER (for the period from November 2, 2021 through December 31, 2021)
	NT$			NT$			NT$			NT$		NT$			US$ (Note 4)			NT$			US$ (Note 4)

Operating revenue	$	704,243		$	(1,159	)	$	39,080		$	2,043,440	$	75,221		$	2,712		$	225,017		$	8,112

Net profit (loss)	$	(217,163	)	$	(469,598	)	$	(11,995	)	$	91,179	$	(4,593	)	$	(166	)	$	(508	)	$	(18	)

Had the abovementioned

business combinations been in effect at the beginning of each annual reporting period and the investments originally accounted for using the equity method been remeasured to their fair value as of January 1 of each respective annual reporting period, the Group’s operating revenues and profit for the year would have been NT$413,782,708 thousand and NT$18,030,506 thousand for the year ended December 31, 2019, respectively, NT$497,146,285 thousand and NT$28,833,916 thousand for the year ended December 31, 2020, respectively, and NT$570,363,380 thousand (US$20,561,045 thousand) and NT$62,277,713 thousand (US$2,245,051 thousand) for the year ended December 31, 2021, respectively. This

pro-forma

information is for illustrative purposes only and is not necessarily an indication of the operating revenue and results of operations of the Group that actually would have been achieved had the acquisition been completed at the beginning of each annual reporting period, nor is it intended to be a projection of future results.

In determining the

pro-forma

operating revenue and profit for the period had each subsidiary been acquired at the beginning of each respective annual reporting period, the Group has calculated the depreciation of property, plant and equipment and the amortization of intangible assets acquired on the basis of the fair values at the initial accounting for the business combination rather than the carrying amounts recognized in the respective

pre-acquisition

financial statements.

As of December 31, 2021, the Group has completed the identification of the difference between the cost of the investment and the Group’s share of FAFG’s net fair value of identifiable assets and liabilities, and has retrospectively adjusted the comparative consolidated financial statements

as of and

for the year ended December 31, 2020. As of December 31, 2020, the retrospective adjustments are summarized as follows:


	December 31, 2020
	After Retrospectively Adjusted		Before Retrospectively Adjusted
	NT$		NT$

Consolidated balance sheet

Inventories	$	48,590,434	$	48,516,459

Financial assets at fair value through profit or loss – non-current	$	2,180,978	$	1,793,188

Property, plant and equipment	$	234,365,397	$	233,207,324

Right-of-use assets	$	8,741,807	$	8,620,612

Goodwill	$	52,709,053	$	54,777,439

Other intangible assets	$	27,711,771	$	26,808,668

Deferred tax liabilities	$	7,121,027	$	6,551,233

Non-controlling interests	$	15,622,009	$	15,616,053