* Deal finalised at $120 per share, 2.8% below Tuesday's close
* The deal had a price guidance of A$118 to A$123.50
* Money earmarked for renewables, tech, infrastructure investment
* New investments to be made in current quarter
* Shares drop as much as 1.3% on Thursday (Adds CEO comments and share price reaction)
By Scott Murdoch
SYDNEY, Aug 29 (Reuters) - Australian investment bank Macquarie Group finalised its biggest ever capital raising of A$1 billion ($675.4 million) on Thursday at a small discount to its stock's closing price before the deal was launched.
The final price of A$120 per share was 2.8% below the close on Tuesday, which, according to two investment banking sources, marks the smallest discount for a capital raising over A$800 million in Australian corporate history.
The deal had a price guidance of A$118 to A$123.50.
Shares of the company, trading in which had been halted pending the deal, fell as much as 1.3% to A$121.9 on Thursday.
The placement will increase Macquarie's total number of outstanding shares by about 2.5%.
Allocations of the new stock have been made this morning to the new and existing investors that participated in the capital raising, people with knowledge of the deal said.
Macquarie said the new stock would start trading alongside the current shares on Tuesday.
Existing shareholders will also be able to participate in a share purchase plan that will allocate a maximum of A$15,000 ($10,131) worth of shares to each investor.
Goldman Sachs has estimated that an extra A$300 million to A$600 million will be raised in this secondary deal aimed at Macquarie's retail investor base.
The new capital will be mostly deployed in the current quarter on transactions already underway, Macquarie CEO Shemara Wikramanayake said.
"The capital raised provides flexibility to take advantage of the opportunities that each of Macquarie's businesses is working on," she said in a statement on Thursday.
Macquarie has flagged it would use the cash from its A$1 billion capital raising to ramp up its investment in global renewable energy, infrastructure and technology assets.
Since March, Macquarie has bought onshore and offshore wind power assets and a U.S. based solar storage facility as part of its strategy to expand into renewable energy. ($1 = 1.4806 Australian dollars) (Reporting by Scott Murdoch; Editing by Rosalba O'Brien and Himani Sarkar)