Wowjoint Holdings (NASDAQ:BWOW)

ON November 30, 2009 China Fundamental Acquisition Corporation announced that it has entered into a definitive share purchase agreement to acquire Beijing Wowjoint Machinery Co., Ltd. and its associated companies. 

Wowjoint Details:

• Wowjoint is a leading solutions provider and manufacturer of specialized heavy duty lifting and carrying machinery in China, deployed primarily in the construction of railways, highways, subways, bridges and ports.
  
• Consolidated revenue for year ended August 31, 2009 was $44.6 million, a 23.2% increase from 2008
  
• Net income for year ended August 31, 2009 was $9.7 million, a 148.4% increase from 2008
  
• Wowjoint projects consolidated revenues of $50-$55 million for year ended August 31, 2010, with net income of $11.5-$12.5 million

Transaction details:

• Under the terms of the definitive agreement, Wowjoint’s shareholders will be issued an aggregate of 5,700,000 ordinary shares of China Fundamental in exchange for 100% of the outstanding shares of Wowjoint.
  
• Assuming a 35% redemption and no exercise of China Fundamental’s outstanding warrants, Wowjoint shareholders will own approximately 60% and China Fundamental’s current shareholders will own approximately 40% of the combined company following the acquisition.
  
• Assuming 35% of China Fundamental’s shares are redeemed, there would be a total of 9.53 million shares outstanding.
  
• If all 7,264,756 outstanding warrants of China Fundamental were exercised, a total of 16.80 million shares would be outstanding on a fully diluted basis or a total of 12.25 million ordinary shares outstanding using the treasury stock method.  The warrants have an exercise price of $5.00 per share.
• possible issuance of an additional 2,800,000 ordinary shares if the funds left to the combined company following the closing are $1,250,000 or less.

Shareholder vote date: 8 a.m. EST on February 12, 2010.