Symbol: LGO (TSX.V)
www.largoresources.com
TORONTO, June 15, 2015 /CNW/ - Largo Resources Ltd.
("Largo" or the "Company") is pleased to announce
that it has received final approval from the Brazilian Development
Bank "BNDES" and its consortium of commercial banks for the
restructuring of its main construction debt facility (the "BNDES
Facility") and its export credit facilities (the "Export
Facilities", collectively with the BNDES Facility, the
"Facilities") for its Maracas Menchen Mine (the
"Plant" or "Project") in Bahia, Brazil.
Further to Largo's press release dated April 27, 2015, the material terms of the
restructuring package include the following:
- An additional one-year grace period on the amortization
schedule for the BNDES Facility;
- A two-year extension of the maturity date for the Export
Facilities;
- A three-year extension of the maturity date for the US dollar
component (as defined below) of the BNDES Facility with no change
in the maturity of the R$ component (as defined below) of the BNDES
Facility1;
- An increase in the guarantee fees payable to the commercial
banks in respect of the BNDES Facility from 3.3% to 3.85% per
annum; and
- Payment of a flat structuring fee in an amount equal to 1.5% of
the aggregate amount of the Facilities.
Mark Smith, President and Chief
Executive Officer, stated: "This is a major milestone for Largo and
the Maracas Menchen Mine. The completed restructuring of our
Facilities, coupled with the successful completion of our recent
CDN$75.2 million equity financing,
provides us with a strong financial foundation as we continue our
ongoing ramp-up at the Plant, and we believe further de-risks the
Company."
He continued: "We would like to sincerely thank our lenders for
their continued support of Largo and the Maracas Menchen Mine. We
believe that their willingness to engage in negotiations and
conclude this restructuring is a strong indication of their belief
in the Project's ability to achieve its intended design capacity
within the timeframe set out by the Company, and also its ability
to generate cash-flow."
He further went on to state: "The Company has now addressed its
financial structure in response to a dramatic decline in the price
of vanadium earlier this year – we strongly believe that this
Project is already a success, and will continue to demonstrate this
as we move forward towards reaching our target capacity."
About Largo
Largo (TSX-V: LGO) is a growing strategic mineral company
focused on continuing to ramp-up production at its Vanadio de
Maracás Menchen Mine.
Largo's Maracás Menchen Mine boasts the highest grade vanadium
deposit yet discovered and is expected to be a low cost producer.
With an off-take in place with Glencore, Largo is well positioned
to become a leading producer of vanadium globally and is expected
to generate substantial cash-flows.
Vanadium is primarily used as an alloy to strengthen steel and
reduce its weight. Vanadium enhanced steels are used in a vast and
growing range of products that are used and encountered every day;
including, rebar, automobiles, transport infrastructure etc. With a
compound annual growth rate of over 6% for the past several years
(Roskill, 2013), vanadium is a bourgeoning commodity which lacks
opportunities for investment in the wider market place. As trends
in the steel industry now demand increasingly stronger and lighter
products for advanced applications, the use of vanadium is expected
to continue this growth over the medium and long term.
Largo is listed on the TSX Venture Exchange under the symbol
"LGO".
For more information please refer to Largo's website:
www.largoresources.com
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Disclaimer
This press release contains forward-looking information under
Canadian securities legislation. Forward-looking information
includes, but is not limited to, statements with respect to
completion of any financings; Largo's development potential and
timetable of its operating, development and exploration assets;
Largo's ability to raise additional funds necessary; the future
price of vanadium, tungsten and molybdenum; the estimation of
mineral reserves and mineral resources; conclusions of economic
evaluation; the realization of mineral reserve estimates; the
timing and amount of estimated future production, development and
exploration; costs of future activities; capital and operating
expenditures; success of exploration activities; mining or
processing issues; currency exchange rates; government regulation
of mining operations; and environmental risks. Generally,
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". All
information contained in this news release, other than statements
of current and historical fact, is forward looking information.
Forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of the 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 SEDAR 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&As.
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PROVIDER) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF
THIS RELEASE
______________________________
1 As stated in a press release on April 27, 2015, there will be no change in the
maturity of the R$ component of the BNDES Loan, while the maturity
of the U.S. dollar component is extended. The BNDES Loan is
denominated in Brazilian reais (R$) and measured as at March 31, 2015, approximately 67% of the total
facility of R$461.2 million was
indexed to the U.S. dollar ("U.S. dollar component"). The
remaining 33% is not indexed ("R$ component").
SOURCE Largo Resources Ltd.