Shares in construction and property firm Baoye Group jumped 8.3 per cent after the company said it would sell HK$566 million worth of new equity to United States hedge fund Tiger Global to fund expansion. Baoye would issue 52.04 million new shares, 7.85 per cent of its enlarged share capital, at HK$10.88 each to Tiger Global which had agreed not to sell the stock for 12 months, the company said in a statement filed with the Hong Kong stock exchange yesterday. The price represents a 9.3 per cent discount to the company's Wednesday closing price of HK$12. The shares, which have gained ninefold since being listed in June 2003, closed up HK$1 at HK$13 yesterday after the announcement. Baoye, which has been a favourite of funds since it went public by selling shares at HK$1.43, last year raised a combined net 366 million yuan by issuing new stock on two occasions. Goldman Sachs bought 43.36 million Baoye shares at HK$4.85 each in November last year, making a HK$353.4 million paper gain based on yesterday's closing price. Chairman Pang Baogen, who personally owns about 30 per cent of Baoye as its biggest shareholder, said the subscription from Tiger Global would broaden his company's capital base and enhance its financial position. The money will be used to buy properties and expand the Zhejiang-based company's energy-saving and environmental friendly construction materials business and for working capital. Baoye more than doubled its first-half profit to 401 million yuan from 177 million yuan a year earlier as turnover increased 13.5 per cent to 2.9 billion yuan. After the latest private share placement to Tiger Fund, which manages more than US$3.5 billion worldwide, Goldman Sachs has a 6.54 per cent stake in Baoye and Atlantis Investment Management has a 5.2 per cent holding.