ACQUISITION OF HUNAN RUIXI AND ITS VIE

9 Months Ended

Dec. 31, 2018

ACQUISITION OF HUNAN RUIXI AND ITS VIE [Abstract]

ACQUISITION OF HUNAN RUIXI AND ITS VIE

On November 21, 2018, the Company entered into the Investment Agreement with Hunan Ruixi and the Hunan Ruixi Shareholders. Pursuant to the Investment Agreement, among other things, the Company acquired from the Hunan Ruixi Shareholders an aggregate of 60% of the outstanding equity interest in Hunan Ruixi for no consideration. The Company closed the acquisition on November 22, 2018 and made a capital contribution of $6 million in Hunan Ruixi, representing 60% of the registered capital of Hunan Ruixi. The Company will be entitled to vote and receive profits based on its equity interest ownership in Hunan Ruixi and the right of first refusal for any issuance of new equity of Hunan Ruixi.

The acquisition had been accounted for as a business combination and the results of operations of Hunan Ruixi have been included in the Company's unaudited condensed consolidated financial statements from the acquisition date. The Company made estimates and judgments in determining the fair value of acquired assets and liabilities, based on an independent valuation report and management's experiences with similar assets and liabilities. The following table summarizes the fair values for major classes of assets acquired and liabilities assumed at the date of acquisition:

	Fair value

Net assets acquired (i)	$	45,895
Gain from acquisition of Hunan Ruixi and its subsidiary		-
Noncontrolling interests (ii)		-
Total purchase consideration	$	-

(i)

Net assets acquired primarily include cash and cash equivalents of $213,645, other current assets of $1,774,725, property and equipment of $36,384, other current liabilities of $607,558 and borrowings from third parties of $1,439,750.

(ii)

Fair value of the noncontrolling interests is estimated with reference to the purchase price per share as of the acquisition date.