Mid-size property developer Chinese Estates last night tried to take advantage of a surge in its share price to raise at least $1.5 billion through a sale of convertible bonds, according to a source. The five-year bonds will pay no interest, but can be converted into shares in Chinese Estates at a premium, which is believed to be in the range of 15-23 per cent above yesterday's closing share price of $6.65, the source said. The price was expected to be finalised early this morning. In case of strong demand, the offer can be increased to $2 billion through the exercise of a $500 million greenshoe option. However, the size is already large enough to double the free float of the company in case the bonds were to be converted in full. The offer was being arranged by Deutsche Bank, which also helped Far East Consortium - another Hong Kong property developer - to raise $754.4 million from a zero-coupon convertible in November last year. The source said Chinese Estates had given no indication of what it may use the money for, other than to say it was for general funding purposes. The timing of the convertible bond was well chosen, given an 11.83 per cent rise in the company's share price yesterday, which took it to a 7?-year high. The stock has risen 26.6 per cent so far this year compared with a 2 per cent decline in the benchmark Hang Seng Index.