Shares of Hoku Scientific Inc., the Kapolei-based technology company, jumped 11 percent after the company announced an agreement to sell stock to large investors and another company for about $25 million as it made progress toward financing an Idaho polysilicon plant.

Shares of Hoku, which trades on the Nasdaq stock market, advanced $1.04 to $10.30 in trading yesterday.

Hoku said a private placement sale of shares managed by Deutsche Bank Securities resulted in the buyers agreeing to purchase 2.89 million shares of its common stock. Under a private placement sale, the shares are sold through privately arranged sales and not offered through public markets.

Hoku said completing the private placement offering is a major stride toward funding of a polysilicon plant it is building in Pocatello, Idaho, for about $400 million. The plant is already under construction and when at full capacity in 2010 will be capable of producing about 3,860 tons of polysilicon annually. Polysilicon is used in the production of computer chips and cells for photovoltaic panels.

"This equity financing is a significant step forward to obtain our larger debt financing for the construction and procurement of our planned polysilicon plant," Dustin Shindo, Hoku Scientific chairman and chief executive officer, said in a news release.

Hoku has said more than half of the funding for construction of the plant will come through customer prepayments. The remainder will be through Hoku's own contribution and debt financing.

The Hawai'i company has been raising cash through the private placement sale and with other cash commitments as part of a requirement it contribute up to $35 million in equity toward the project before it can get up to $185 million in financing for the plant from Merrill Lynch.

Hoku said institutional investors and a unit of Suntech Power Holdings Co. agreed to buy shares through the private placement at about $8.65 each. Suntech, which also has an agreement to buy polysilicon from the Idaho plant, is becoming a significant shareholder in the Kapolei company through the transaction.

The share sale will increase the number of Hoku shares outstanding to about 19.8 million, or about 17 percent more than it has currently. The private placement transaction is scheduled to close by the end of the week.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.