Engineering firm Coffey International says it will issue about $40 million in new shares to pay down debt.

The company announced a fully underwritten capital raising on Wednesday to “substantially strengthen” its balance sheet as it forges ahead with a restructure as part of a strategic review announced in June this year.

The issue of new shares will allow management to “focus on delivering operational results and providing greater certainty and confidence for staff and clients”, the company said in a statement.

Coffey said it would raise $29.1 million through a non-renounceable entitlement offer to institutional and retail investors.

Separately, it will raise $10.9 million through an institutional placement.

The Australian branch of UBS AG will fully underwrite the capital raising, Coffey said, and all company directors will take up their entitlements in full.