Murugappa Group’s engineering firm Tube Investments of India Limited (TII) has announced that the company is raising Rs. 350 crore in capital from Azim Premji Trust and SBI Mutual Fund through a preferential allotment or private placement. The company said on Thursday that its board has approved raising the fund and it is the part of the group’s plan to raise equity to fund its acquisition of CG Power. The shares were placed at Rs. 731.7 apiece against Thursday’s close of Rs. 815.

Azim Premji Trust will receive 2.73 million equity shares, each, fully paid at Rs. 731.70 and inclusive of a premium of Rs. 730.70 per equity share. The total investment would be around Rs. 200 crore. The company stated in a regulatory filing that the two SBI Mutual Fund schemes, SBI Focused Equity Fund and SBI Magnum Midcap Fund, will receive 1.5 million and 546,000 shares worth Rs. 110 crore and Rs. 40 crore, respectively.

Both allotments are subject to shareholders’ approval, the company said, adding that it would hold an extraordinary general meeting on 21 December to secure necessary approvals. On Thursday, Tube Investments also paid Rs. 587.5 crore to subscribe to equity shares and warrants of CG Power & Industrial Solutions Ltd.

CG Power’s board approved the allotment of shares and warrants to TII. “We inform that the Company has acquired a controlling interest and holds 50.62 percent,” TII said in a statement. With this CG Power will become a subsidiary of TII and the Murugappa group management has recalled its former finance director, N Srinivasan to head CG Power as its MD.

In August, Tube Investment entered into an agreement with fraud-hit CG Power to acquire around 56% controlling stake in the latter at an investment of around Rs. 800 crore. TII was declared as the successful bidder to acquire a majority stake in CG Power in September, and the Competition Commission of India has also approved TII’s proposed acquisition.