China Aerospace International Holdings is the latest mainland-controlled red-chip to tap the stock market for funds, placing $546.8 million worth of shares. The Hong Kong-listed arm of mainland rocket-maker China Aerospace Corp (CASC) said funds raised would help set up an optical-fibre digital cable broadcasting network, decoder systems manufacture, and satellite network development. China Aerospace International said its ultimate parent CASC would place 109.4 million existing shares at $2.45 a share. It would subscribe for 223.2 million new shares at the same price to maintain its 51 per cent holding in the company. The existing shares were placed by Credit Lyonnais Securities (Asia) and C.A. Pacific Capital. The shares placed represent 9.8 per cent of the company's existing share capital. The subscription shares represent 20 per cent of the company's existing share capital. The placing and subscription price was at an 8.4 per cent discount to the stock's last traded price of $2.675. China Aerospace International stock has risen by more than 10 per cent in two weeks on expectation the company would conclude deals soon. A company spokesman yesterday said it had been a long-held strategy to focus on the hi-tech consumer sector on the mainland, where it had a substantial technological and regulatory advantage over domestic and foreign rivals. He said the company would develop a cable broadcasting network direct-to-home (DTH) satellite TV broadcasting in the longer term. Progress had been made in the development of DTH satellite broadcasting business with its parent, through its 30 per cent stake in Beijing Aerospace Sat-Way Information System Co, a joint venture with its parent. About $110 million would be spent setting up an optical-fibre network for a provincial cable TV station on the mainland. He would not name the province, but the company's vice-chairman Lu Kunlai has said it would form a cable TV network in Jiangsu. The spokesman said the company would spend another $80 million on the development of an educational broadcasting station. About $120 million would go towards funding the manufacture of digital decoder systems for use in cable TV and satellite broadcasting. Another $90 million would be used on the joint development of the satellite broadcasting network under the joint venture with CASC.