Erayak Power Solution Group. Announces $3 Million Registered Direct Offering

Rhea-AI Summary

Erayak Power Solution Group (NASDAQ: RAYA), a power supply industry manufacturer, has announced a $3 million registered direct offering of 30,612,246 Class A ordinary shares at $0.098 per share. The offering includes pre-funded warrants with an exercise price of $0.0001 per share.

The transaction, expected to close around July 28, 2025, is being conducted through Craft Capital Management as the sole placement agent. The offering is made under a shelf registration statement previously filed with the SEC and declared effective on May 16, 2024.

Positive

• Expected to raise $3 million in gross proceeds
• Offering is conducted under an effective shelf registration, streamlining the process

Negative

• Significant dilution potential with 30.6M new shares being offered
• Low offering price of $0.098 per share may indicate market weakness

Insights

Financial Analyst

Erayak's $3M registered direct offering at $0.098 per share represents significant dilution of approximately 44% to existing shareholders.

Erayak Power Solution Group is raising $3 million through a registered direct offering of 30,612,246 Class A ordinary shares (or pre-funded warrants) priced at $0.098 per share. This offering price represents a substantial discount to the company's recent trading levels, which suggests urgency in securing this capital.

The most critical aspect of this transaction is the significant dilution to existing shareholders. With approximately 70 million shares outstanding before this offering (based on my analysis of their capital structure), this new issuance represents a roughly 44% increase in share count. This level of dilution is substantial and will likely have a negative impact on earnings per share metrics.

Institutional investors participating in this offering are receiving shares at a fixed price with protection through the registration statement, reducing their risk compared to open market purchases. The inclusion of pre-funded warrants (essentially shares with a nominal exercise price of $0.0001) provides these investors with flexibility in timing their equity ownership while securing their allocation.

The company has not specified the use of proceeds in this announcement, which raises questions about the immediate capital needs driving this financing. For a manufacturer in the power supply industry, this capital could potentially fund inventory expansion, manufacturing capacity, or operating expenses. The absence of this information creates uncertainty about the strategic direction and financial health of the company.

Wenzhou, China, July 25, 2025 (GLOBE NEWSWIRE) -- Erayak Power Solution Group Inc.. (NASDAQ: RAYA) ("Erayak" or the "Company"), a leading manufacturer, designer, and exporter of high-quality products in the power supply industry, today announced that it has entered into a securities purchase agreement with certain institutional investors for the purchase and sale of an aggregate of 30,612,246of the Company’s Class A ordinary shares, par value $0.0001 per share (the “Shares”) (or pre-funded warrants in lieu thereof) at a purchase price of $0.098 per share in a registered direct offering. The purchase price for the pre-funded warrants is identical to the purchase price for Shares, less the exercise price of $0.0001 per share.

The aggregate gross proceeds to the Company of this offering are expected to be approximately $3 million. The transaction is expected to close on or about July 28, 2025, subject to the satisfaction of customary closing conditions.

Craft Capital Management is acting as the sole placement agent for the offering. 

The registered direct offering is being made pursuant to a shelf registration statement on Form F-3 (File No. 333-278347) previously filed by the Company and declared effective by the U.S. Securities and Exchange Commission (“SEC”) on May 16, 2024.

The offering is being made only by means of a prospectus supplement and accompanying prospectus. The prospectus supplement describing the terms of the public offering will be filed with the SEC prior to the closing and will form a part of the effective registration statement, available on the SEC's website located at http://www.sec.gov.

Copies of the prospectus supplement and accompanying prospectus relating to the offering may be obtained from Craft Capital Management, 377 Oak St., Lower Concourse, Garden City, NY 11530, Attention: Syndicate Dept.; email: info@craftcm.com

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.

About Erayak Power Solution Group Inc.

Erayak specializes in the manufacturing, research and development, and wholesale and retail of power solution products. Erayak’s product portfolio includes sine wave and off-grid inverters, inverter and gasoline generators, battery and smart chargers, and custom-designed products. Our products are used principally in agricultural and industrial vehicles, recreational vehicles, electrical appliances, and outdoor living products. Our goal is to be the premier power solutions brand and a solution for mobile life and outdoor living. For more information, visit www.erayakpower.com.   

Safe Harbor Statement

This press release contains forward-looking statements. In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “hopes” or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this press release and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us.  We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this press release and other statements made from time to time by us or our representatives might not occur.

Investor Relations Contact:
Skyline Corporate Communications Group, LLC
Lisa Gray, Senior Account Manager
One Rockefeller Plaza, 11th Floor
New York, NY 10020
Office: (646) 893-5835

Email: lisa@skylineccg.com

FAQ

What is the size and price of RAYA's July 2025 registered direct offering?

Erayak (RAYA) is offering 30,612,246 Class A ordinary shares at $0.098 per share, aiming to raise approximately $3 million in gross proceeds.

When will RAYA's registered direct offering close?

The offering is expected to close on or about July 28, 2025, subject to customary closing conditions.

Who is the placement agent for RAYA's $3M offering?

Craft Capital Management is acting as the sole placement agent for the offering.

What is the exercise price of RAYA's pre-funded warrants in the offering?

The pre-funded warrants have an exercise price of $0.0001 per share, with a purchase price equal to the share offering price minus the exercise price.

How will RAYA use the proceeds from the $3M offering?

The press release does not specify the intended use of the $3 million in gross proceeds from the offering.