3. ACQUISITION OF SUBSIDIARIES

		Julun Network

		On November 30, 2010, Giant Network acquired 100% equity interest of Julun Network, a developer of online games incorporated in China, for RMB15,906,862 (US$2,410,131). Giant Network acquired Julun Network for the knowledge and expertise of its R&D employees. The acquisition met the definition of a business acquisition in accordance with ASC subtopic 805-10.

		Total purchase consideration is RMB15,906,862 (US$2,410,131). Breakdown of the total purchase consideration is as follows:

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as at the date of acquisition:


	RMB			US$
Current assets		994,365			150,661
Property and equipment, net		503,798			76,333
Online game software		1,146,029			173,641


Total assets acquired		2,644,192			400,635


Accounts and other payables		(2,662,605	)		(403,425	)
Accrued liabilities		(52,098	)		(7,894	)


Total liabilities assumed		(2,714,703	)		(411,319	)


Net liabilities acquired		(70,511	)		(10,684	)
Goodwill		15,977,373			2,420,815


Total fair value of purchase price consideration		15,906,862			2,410,131

		The fair value of the online game software was determined based on an independent valuation using an income approach, which involves applying an appropriate discount rate to estimated cash flows that will be derived from the online game in the future. The goodwill represented expected synergies arising at acquisition from the knowledge and expertise of the employees of Julun Network.

		Pro forma results of operation for this acquisition have not been presented because the effects of the acquisition were not material to the Group’s consolidated financial results.