McNally Bharat Engineering Company, engaged in providing turnkey solutions, announced that it has entered into an agreement with EMC and Williamson Magor Group, existing promoters, to enable an additional equity investment of up to Rs 1 billion as primary capital into McNally.

The board of the company has approved the proposed investment by EMC in the company. Earlier, MKN Investments, a group company of EMC, had made an investment of Rs 500 million in March 2015 in the company and it holds 12.5% stake in the company.

The above mentioned capital raising of Rs 1 billion by the company would be done through a preferential allotment of 10 million shares to EMC at a price of Rs 100 a share.

After this preferential issue, EMC Group (along with MKN Investments) will hold 29.64% of McNally's expanded equity share capital.

In addition, as per SEBI guidelines, there will also be an open offer by EMC and Williamson Manor Group for up to 26% of the equity share capital of the company.

Under the investment agreement entered into by the existing promoters, EMC and the Company, NcNally would be jointly controlled by the existing promoters and EMC, with both parties having equal board representation in McNally and its subsidiaries.

Shares of the company gained Rs 14.1, or 17.83%, to trade at Rs 93.20. The total volume of shares traded was 210,486 at the BSE (10.11 a.m., Wednesday).