Where you discuss how cash flows through your organization, please provide cross-references to the condensed consolidating schedule and the consolidated financial statements.
In response to the Staff’s comment, the Company has revised the disclosure on the prospectus cover page of the Amendment No. 3.
Selected Historical Financial Data of Prenetics, page 48
Please tell us and clarify in Note (b) on pages 48-49 what is meant by the “elimination of exchange reverse upon consolidation”.
In response to the Staff’s comment, the Company has revised the disclosure on pages 50, 53 and 56 of the Amendment No. 3.
We note your response to comment 5. Please address the following:
Please present major line items in your consolidating schedules, such as direct costs, and subtotals as well as disaggregated intercompany amounts, such as separate line items for intercompany receivables and investment in subsidiary; and
Please further revise your consolidating schedules to also disaggregate the parent company, the VIEs and its consolidated subsidiaries, the WFOEs that are the primary beneficiary of the VIEs, and an aggregation of other entities that are consolidated. The objective of this disclosure is to allow an investor to evaluate the nature of assets held by, and the operations of, entities apart from the VIE, as well as the nature and amounts associated with intercompany transactions. Any intercompany amounts should be presented on a gross basis and when necessary, additional disclosure about such amounts should be included in order to make the information presented not misleading.
In response to the Staff’s comment, the Company has revised the disclosure on pages 47 through 56 of the Amendment No. 3.
The Company would like to provide further information and clarify the nature of the transactions involving Prenetics Limited (“Prenetics HK”) and the VIE Entity. Prenetics HK provided a loan in the amount of RMB29,250,000 to a Hong Kong incorporated company (“HK Borrower”), a wholly owned subsidiary of a shareholder of the China Investment (the “China Investor”), and recognized it as “Other receivables” in the statements of financial position of Prenetics HK. A loan in the same amount was made by a PRC incorporated company (“PRC Lender”), a wholly owned subsidiary of the China Investor, to the VIE Entity to help Prenetics HK fulfil its funding obligation in respect of the China Investment. Such amount was recognized by the VIE Entity as “Other payables” in the statements of financial position.
Given the transactions relate to Prenetics HK’s capital contribution to the VIE Entity, the related balances were eliminated upon consolidation in Prenetics Group’s consolidated statements of financial position.
PubCo’s securities may be delisted or prohibited from being traded…, page 61
Please update your disclosure regarding the HFCAA to reflect that the Commission adopted rules to implement the HFCAA and that, pursuant to the HFCAA, the PCAOB has issued its report notifying the Commission of its determination that it is unable to inspect or investigate completely accounting firms headquartered in mainland China or Hong Kong.
In response to the Staff’s comment, the Company has revised the disclosure on pages 67 and 68 of the Amendment No. 3.