Haoxi Health Technology Limited Announces the Closing of a $12 Million Underwritten Follow-on Public Offering

Rhea-AI Summary

Haoxi Health Technology (HAO), an online marketing solution provider based in Beijing, has successfully closed its previously announced underwritten follow-on public offering. The company raised $12 million by offering 4,000,000 units at a price of $3.00 per unit. Each unit consists of one Class A Ordinary Share (or pre-funded warrant), one Series A warrant, and one Series B warrant.

The offering was conducted on a firm commitment basis, with EF Hutton acting as the sole bookrunner. HAO has granted EF Hutton a 45-day option to purchase up to an additional 600,000 units to cover over-allotments. The company plans to use the proceeds for business expansion and technology investments in the healthcare industry.

Positive

• Successful closing of a $12 million follow-on public offering
• Potential for additional $1.8 million through over-allotment option
• Funds to be used for business expansion and technology investments

Negative

• Potential dilution of existing shareholders due to new share issuance
• Complex warrant structure may confuse investors

Insights

Financial Analyst

The closing of HAO's $12 million follow-on public offering is a significant financial move for the company. The structure of the offering, including Units with Class A Ordinary Shares and various Warrants, is complex but potentially beneficial. The $3.00 per Unit price and the additional Warrant features could attract investors looking for upside potential. However, the dilutive effect of 4,000,000 new Units and potential additional dilution from Warrant exercises must be considered. The over-allotment option for 600,000 more Units adds further complexity. While the fresh capital can fuel HAO's expansion plans in the healthcare industry, investors should closely monitor how effectively the company deploys these funds to generate returns.

Market Research Analyst

HAO's successful closing of this public offering amid challenging market conditions for Chinese companies signals investor confidence in their business model and growth prospects. The company's focus on healthcare technology aligns with global trends, potentially positioning them well in a high-growth sector. However, the complex Unit structure with multiple Warrants may indicate a need to sweeten the deal for investors, possibly due to market skepticism or competition. The firm commitment basis of the offering is a positive sign, but the true test will be HAO's ability to translate this capital into market share and revenue growth in the competitive online marketing and healthcare tech spaces.

Legal Expert

The legal structure of HAO's offering is noteworthy. The use of multiple Warrant types with different exercise dates adds complexity but also flexibility for both the company and investors. The SEC's approval of the registration statement is crucial, indicating compliance with regulatory requirements. However, investors should be aware of the potential for significant share dilution if all Warrants are exercised. The disclaimer about not constituting an offer to sell in certain jurisdictions is standard but important, highlighting the need for investors to verify their eligibility. The involvement of reputable legal firms for both HAO and the underwriter adds credibility to the offering's structure and execution.

BEIJING, Sept. 20, 2024 (GLOBE NEWSWIRE) -- Haoxi Health Technology Limited (the “Company” or “HAO”), an online marketing solution provider headquartered in Beijing, China, today announced that it closed its previously announced underwritten follow-on offering of 4,000,000 units (each a “Unit,” and collectively, the “Units”) at a public offering price of $3.00 per Unit (the “Offering”). Each Unit consists of (i) one share of Class A Ordinary Share, par value $0.0001 per share (the “Class A Ordinary Share”) (or one pre-funded warrant to purchase one Class A Ordinary Share (the “Pre-Funded Warrant”)), (ii) one Series A warrant to purchase one Class A Ordinary Share (the “Series A Warrant”) initially, but five Class A Ordinary Shares on and after the Series B Exercise Date, and (iii) one Series B warrant to purchase four of Class A Ordinary Shares on and after the sixteenth (16th) calendar day (the “Series B Exercise Date”) following the closing of the Offering (the "Series B Warrant”, together with the Series A Warrant, the “Warrants”). The Units have no stand-alone rights and therefore are not certificated or issued as stand-alone securities. The Class A Ordinary Shares and related Warrants are issued separately in the Offering. The Company received aggregate gross proceeds of $12,000,000 from the Offering, before deducting underwriting discounts and other offering expenses, excluding the exercise of any Warrants.

The Offering has been conducted on a firm commitment basis. The Company has granted EF Hutton LLC (“EF Hutton”), the underwriter, an option, within 45 days from the closing date, to purchase up to an additional 600,000 Units at the public offering price, less underwriting discounts, to cover the over-allotment.

EF Hutton is acting as the sole bookrunner for the Offering. Hunter Taubman Fischer & Li LLC is acting as U.S. counsel to the Company, and Pryor Cashman LLP is acting as U.S. counsel to EF Hutton, in connection with the Offering.

“We are pleased to close this offering and appreciate the continued support and market recognition as we execute our business plan” said Mr. Zhen Fan, Chairman and CEO of HAO. “The proceeds provided by this offering will help facilitate our continued business expansion and technologies investment in healthcare industry.”

The registration statement on Form F-1 (File No. 333-280174) relating to the Offering, as amended, was filed with the U.S. Securities and Exchange Commission (the "SEC"), and was declared effective by the SEC on September 19, 2024. The Offering is being made only by means of a prospectus. Copies of the final prospectus related to the Offering may be obtained, from EF Hutton, Attn: Syndicate Department, 590 Madison Avenue, 39^th Floor, New York, NY 10022, or via email at syndicate@efhutton.com or telephone at (212) 404-7002. In addition, a copy of the final prospectus can also be obtained via the SEC’s website at www.sec.gov.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or 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 jurisdiction.

About Haoxi Health Technology Limited

Haoxi Health Technology Limited is a Beijing-headquartered online marketing solution provider in China, specializing in serving healthcare industry advertiser clients. The Company’s growth is driven by the rise of news feed ads and the rapid development of the healthcare sector. The Company offers one-stop online marketing solutions, especially in online short video marketing, helping advertisers acquire and retain customers on popular platforms in China, such as Toutiao, Douyin, WeChat, and Sina Weibo. It is dedicated to reducing costs, increasing efficiency, and providing easy online marketing solutions to advertisers. For more information, please visit: http://ir.haoximedia.com.

Forward-Looking Statement

This press release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may", "will", "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. These forward-looking statements include, without limitation, the Company's statements regarding the expected trading of its Ordinary Shares on the Nasdaq Capital Market and the closing of the Offering. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions and the completion of the initial public offering on the anticipated terms or at all, and other factors discussed in the “Risk Factors” section of the registration statement filed with the SEC. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

For more information, please contact:

Underwriter
EF Hutton LLC
Ms. Stephanie Hu, Head of Asia, Investment Banking
Email: syndicate@efhutton.com  

Investor Relations
WFS Investor Relations Inc.
Janice Wang, Managing Partner
Email: services@wealthfsllc.com
Phone: +86 13811768599
+1 628 283 9214

FAQ

What was the size of Haoxi Health Technology's (HAO) recent public offering?

Haoxi Health Technology (HAO) raised $12 million through an underwritten follow-on public offering of 4,000,000 units priced at $3.00 per unit.

How does Haoxi Health Technology (HAO) plan to use the funds from its recent offering?

HAO plans to use the proceeds from the offering for business expansion and technology investments in the healthcare industry.

What was included in each unit of Haoxi Health Technology's (HAO) public offering?

Each unit in HAO's offering consisted of one Class A Ordinary Share (or pre-funded warrant), one Series A warrant, and one Series B warrant.

Who was the underwriter for Haoxi Health Technology's (HAO) recent public offering?

EF Hutton acted as the sole bookrunner for HAO's follow-on public offering.