Resource Capital Funds has lifted its stake in MZI Resources to 15 per cent after the mineral sands group conducted a $5 million equity raising.
MZI said a fund of the US-based private equity firm had subscribed for $1.8 million of the placement. The moves raised RCF's shareholding from a previous 11 per cent.
RCF has also committed $US41.5 million ($44 million) in funding for the development of the Keysbrook project near Perth.
In total, MZI placed $4 million at 1.3 cents a share through Argonaut Capital and Foster Stockbroking. The other $1 million comes from a share purchase plan.
The company said the exercise ensured it had sufficient funds to continue early-stage work on Keysbrook while seeking to finalise debt funding.
MZI Chief Executive Officer Trevor Matthews said raising was a strong sign of support for the company and the project.
"The support for this raising, combined with RCF's offer to provide funding, highlights the economic strengths of Keysbrook," Mr Matthews said.MZI's shares were unchanged at 1.5 cents at 10.09am.