Largo receives term sheet for iron ore calcine sale

Executive Summary

• Largo Inc. has received a binding term sheet for the sale of 4.5 million tons of iron ore calcine, a byproduct accumulated over 11 years at its Maracas Menchen mine in Brazil.
• The potential transaction involves a multiyear Ex Works (EXW) contract with expected cash proceeds exceeding $56 million (U.S.), subject to final documentation and customary conditions.
• The company views this as a strategic opportunity to unlock value from existing inventory, reduce infrastructure and disposal costs, and enhance the cost-competitiveness of its primary vanadium business.

Key Details

• Asset Sold: 4.5 million tons of iron ore calcine material.
• Source: Stockpile accumulated over the past 11 years of vanadium production at the Maracas Menchen mine in Maracas, Bahia, Brazil.
• Financial Value: Potential cash proceeds in excess of $56 million (U.S.).
• Contract Structure: Multiyear Ex Works (EXW) contract.
• Conditions Precedent: Subject to final documentation, amendments to certain commercial terms, and customary conditions.
• Strategic Rationale: To unlock value from accumulated materials, reduce future infrastructure requirements for stockpiles, and reduce disposal costs while maintaining focus on the core vanadium business.
• Company Context: Largo is a primary vanadium producer with a diversified byproduct portfolio including iron ore, titanium, and other mineral components.

Notable Quotes

• "This binding term sheet reflects external demand for materials generated as byproducts from our operations and highlights the strategic value of Largo's byproduct inventory as a way to enhance further the cost-competitiveness of our vanadium business." — Alberto Arias and Daniel Tellechea, Co-CEOs of Largo.
• "We believe this approach provides a constructive path to realizing value from assets already on hand, while supporting our broader financial and operational objectives." — Alberto Arias and Daniel Tellechea, Co-CEOs of Largo.