Latrobe Magnesium (ASX:LMG) secured a total of AU$6.3 million in funding commitments and debt finance to back the start of operations at its demonstration plant in Victoria, according to a Friday filing with the Australian bourse.

The fundraising comprises AU$2.8 million via an institutional placement and AU$800,000 via a fully underwritten share purchase plan (SPP).

The company intends to issue up to 250 million shares under the placement at a price of AU$0.011 each, representing a 15% discount to the last traded price. Latrobe Magnesium directors committed AU$550,000 under the placement.

Shaw & Partners acted as corporate adviser to the company, as well as sole lead manager to the placement and SPP, and underwriter to the SPP, per the filing.

Further, the company secured approval to draw down AU$2.8 million of available debt finance at an interest rate of 10%, the filing stated.

Latrobe Magnesium is targeting to begin operations at the plant by the end of May.