China Discovery Acquisition Corp. to acquire Instant Noodle Company in $90 Million Transaction

China Discovery Acquisition Corp. (OTCBB: CADQE, CADWE, CADUE) and privately-held HeNan Smart Food Company announced that they have entered into a definitive share exchange agreement whereby China Discovery will issue 14.7 million shares and cash consideration of $3.0 million in exchange for 100.0% of Si Mei Te, subject to China Discovery shareholder approval.

Si Mei Te is an instant noodle producer in China, the largest instant noodle market in the world. Si Mei Te produces and sells its products under several brands and is ranked among the top 5 instant noodle producers in China based on market share.

Under the terms of the transaction, China Discovery will acquire 100.0% of Si Mei Te in exchange for 14.7 million newly issued shares of China Discovery and cash consideration of $3.0 million (representing total transaction consideration of approximately $87.4 million based upon the closing price for a China Discovery ordinary share of $5.74 on April 13, 2009). After the closing, China Discovery will have approximately 21.8 million basic shares outstanding and 24.4 million fully diluted shares outstanding(4). Si Mei Te current shareholders will own approximately 67.4% of the basic shares outstanding and 60.3% of the fully diluted shares outstanding in the pro-forma company.

Read the release here