Largo Announces Pricing of US$23.4 Registered Direct Offering and Private Placement
Largo Inc. ("Largo" or the "Company") (TSX: LGO) (NASDAQ: LGO) announces that it has entered into securities purchase agreements with institutional and accredited investors for the purchase and sale of 14,262,309 common shares of the Company ("Common Shares") at a purchase price of US$1.22 per Common Share in a registered direct offering for aggregate gross proceeds of US$17.4 million. In a concurrent private placement (together with the registered direct offering, the "Offering"), the Company will issue unregistered warrants to purchase up to 14,262,309 Common Shares ("Warrants") with an exercise price of US$1.22 per Warrant that will be immediately exercisable upon issuance and will expire five years from issuance. The closing of the Offering is expected to occur on or about October 22, 2025, subject to the satisfaction of certain closing conditions and approval from the TSX, as further described below.
In a concurrent private placement, Arias Resource Capital Fund III L.P. ("ARC Fund III"), an affiliate of the Company's largest shareholder, has agreed to provide the Company with financing of US$6 million and has entered into a securities purchase agreement to acquire 4,918,033 Common Shares and 4,918,033 Warrants (the "ARC Commitment"). Such offering shall be a private placement on the same terms as the Common Shares and Warrants offered pursuant to the Offering. A portion of the ARC Commitment may be advanced by way of a US$5 million secured convertible bridge loan (the "ARC Bridge Loan", and, together with the ARC Commitment, the "ARC Offering") which would reduce the ARC Commitment by US$5 million. If provided, the ARC Bridge Loan would automatically convert on the closing of the Offering into units consisting of unregistered Common Share and Warrants on the same terms as the Offering. The ARC Bridge Loan will carry an interest rate of 12% per annum, payable upon maturity in two (2) years or immediately upon default. The ARC Bridge Loan will be secured against the common shares of Largo Resources (Yukon) Ltd., a wholly owned subsidiary of the Company. The proceeds of the potential ARC Bridge Loan would be used to make an equity contribution to Largo's principal operating subsidiary, Largo Vanádio de Maracás S.A. ("LVMSA") and would be used by LVMSA for working capital purposes; payments to the senior lenders to LVMSA would occur following the closing of the Offering and ARC Offering. Alberto Arias is director and chair of the board of directors of the Company and funds managed by Arias Resource Capital have been a significant investor of the Company since 2010.
H.C. Wainwright & Co. is acting as sole placement agent for the Offering and the ARC Offering.
The use of proceeds from the ARC Bridge Loan will be to sustain the Company's working capital until 2026, and the use of proceeds of the Offering and the remaining proceeds from the ARC Offering, net of placement agent fees and other Offering expenses payable by the Company, will be to make payment to the Company's Brazilian lenders and payments to the mining contractor at the Maracás Menchen Mine and other key suppliers, which is already starting to negatively impact rates of mine production due to liquidity constraints.
The Company has applied to the TSX for an exemption from requirements regarding pricing, terms and size of the Offering and the ARC Offering, securityholder approval requirements for the Offering and the ARC Offering, and formal valuation and minority approval requirements for the Offering and the ARC Offering, on the basis that the Company finds itself in a state of serious financial difficulty and that the Offering and the ARC Offering are designed to improve the Company's financial situation in a timely manner. If the TSX does not approve the exemption, the Company is required to obtain the approval of its securities holders in accordance with the TSX Company Manual before the offering may be completed. There is no assurance that TSX approves this request for an exemption.
The Common Shares (but not the unregistered Common Shares issued in the ARC Offering, the unregistered Warrants and the Common Shares underlying the Warrants) in the Offering described above are being offered by the Company pursuant to an effective shelf registration statement on Form F-3 (File No. 333-290163) previously filed with the U.S. Securities and Exchange Commission (the "SEC"), under the Securities Act of 1933, as amended (the "Securities Act"), and declared effective by the SEC on September 19, 2025. The offering of the common shares is being made only by means of a prospectus, including a prospectus supplement, forming a part of the effective registration statement. A prospectus supplement and accompanying prospectus describing the terms of the registered direct offering will be filed with the SEC and, once filed, will be available on the SEC's website located at http://www.sec.gov. Electronic copies of the prospectus supplement and accompanying prospectus may be obtained, when available, from H.C. Wainwright & Co., LLC, 430 Park Avenue, 3rd Floor, New York, NY 10022, or by telephone at (212) 856-5711, or by email at [email protected].
The private placement of the Warrants and the underlying Common Shares in the Offering and any securities issued in the ARC Offering will be made in reliance on exemptions from registration under the Securities Act and applicable state securities laws. Accordingly, the securities issued in the concurrent private placements may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. The Warrants issued in the Offering will also possess certain resale registration rights under the Securities Act.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About Largo
Largo is a globally recognized supplier of high-quality vanadium and ilmenite products, sourced from its world-class Maracás Menchen Mine in Brazil.
Largo's common shares trade on the Nasdaq Stock Market and on the Toronto Stock Exchange under the symbol "LGO".
Forward-Looking Information
This press release contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities legislation. Forward‐looking information in this press release includes, but is not limited to, statements with respect to the Offering, ARC Bridge Loan, ARC Commitment and the timing of the same; the ability of the Company to continue as a going concern; the anticipated number of Common Shares and Warrants to be issued by the Company pursuant to the Offering and ARC Offering, the impact of the Offering, ARC Offering and the results thereof; receipt of the regulatory and TSX approval; the closing of the Offering, the satisfaction of the closing conditions in the Offering, the anticipated use of proceeds from the Offering and ARC Offering; and the ability for the Company to keep the Maracás Menchen Mine operating, thereby significantly improving the Company's financial situation.
Forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved", although not all forward-looking statements include those words or phrases. In addition, any statements that refer to expectations, intentions, projections, guidance, potential or other characterizations of future events or circumstances contain forward-looking information. Forward-looking statements are not historical facts nor assurances of future performance but instead represent management's expectations, estimates and projections regarding future events or circumstances. Forward-looking statements are based on our opinions, estimates and assumptions that we considered appropriate and reasonable as of the date such information is stated, subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Largo to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks described in the annual information form of Largo and in its public documents filed on www.sedarplus.ca and available on www.sec.gov from time to time. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Although management of Largo has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Largo does not undertake to update any forward-looking statements, except in accordance with applicable securities laws. Readers should also review the risks and uncertainties sections of Largo's annual and interim MD&A which also apply.
Trademarks are owned by Largo Inc.
Neither the Toronto Stock Exchange (nor its regulatory service provider) accepts responsibility for the adequacy or accuracy of this release
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For more information, please contact: Investor Relations
Daniel Tellechea
Interim CEO & Director
+1.416.861.9797
[email protected]