Largo to buy vanadium-PGM deposit in Brazil
2007-04-20 17:50 ET - News Release
Mr. Mark Brennan reports
LARGO RESOURCES ANNOUNCES SIGNING OF DEFINITIVE AGREEMENT REGARDING BRAZILIAN VANADIUM-PGM DEPOSIT
Largo Resources Ltd. has entered into a definitive share purchase agreement to acquire a 90-per-cent interest in Companhia de Maracas which is currently owned by Odbpar Investimentos S.A. and Companhia Vale Do Rio Doce. The company holds a 95.38-per-cent equity interest in Vanadio de Maracas Ltda., an entity that owns the mining rights for vanadium in respect of a 2,000-hectare property located in the municipality of Maracas, state of Bahia, Brazil. The property is located 813 kilometres northeast of Brasilia, the capital of Brazil, and 250 kilometres southwest of Salvador, the capital of Bahia state.
Pursuant to the purchase agreement, Largo must pay to the vendors $1-million (U.S.) by April 30, 2007, and an additional $4-million (U.S.) by May 1, 2008, in order to acquire 50 per cent plus one of the issued and outstanding shares of the company. Largo is required to make a final payment of $5-million (U.S.) by Nov. 1, 2008, in order to acquire an additional 40 per cent less one of the company's issued and outstanding common shares. Largo has agreed to pay interest of 5.5 per cent per year to the vendors in respect of the portion of the purchase price not yet paid.
In connection with the acquisition, Cancap Investments Ltd. will retain a 2-per-cent net smelter return (NSR) royalty on the company and will be issued 300,000 common shares of the company at a deemed price of 25 cents per share as a finder's fee. The agreement and finder's fee remain subject to regulatory approval.
|
