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MINING goliath Rio Tinto has upped its relevant interest in uranium play Energy Resources of Australia to 80.6% following the closing of the institutional component of ERA’s entitlement offer.

Energy Resources of Australia's Ranger uranium mine
In a notice lodged with the Australian Securities Exchange, Rio increased its stake in ERA from 130.45 million shares to 354 million shares.

Under the institutional component, ERA raised $380 million after issuing 249 million shares at $1.53 per share, a 30% discount to the theoretical ex-rights price.

ERA said the offer attracted strong demand from its institutional shareholders, including Rio Tinto’s participation for its full 68.4% entitlement.

Proceeds from the entitlement offer will fund construction of a brine concentrator and other water management initiatives, construction of the Ranger 3 Deeps exploration decline and associated drilling.

Funding will also be used to complete evaluation studies into the development of the Ranger 3 Deeps mine and exploration program to test targets on the Ranger project area.

The retail component of the entitlement offer opened on October 19 and will close on November 9.

It is expected to raise around $120 million.

Shares in ERA were trading 5c lower at $2.05 in afternoon trade.