Largo Resources Ltd. (CVE:LGO) (PINK:LGORF) stock price added significant value after the company announced progress related to the would-be development of their vanadium property.
LGO stock price jumped up 11.5% on Thursday following the breakout above 30 cents per share resistance. The accompanying trading volume was 900 thousand, more than twice the average of 412 thousand. This spike in price was caused by news event and thus has merit to continue.
On Wednesday, November 9, Largo announced to have received binding commitments from a group of banks for a $150 million financing that the company needs to develop the Maracas Vanadium Project in Brazil. The money should be granted in a form of a loan facility which will be secured through Largo’s subsidiary Vanadio de Maracas Ltda.
On November 2, the company announced to have received a letter of intent from the government of the State of Bahia to support the Maracas project through various tax incentives applied to Largo. These should include reduction of VAT, applicable to purchases of fixed assets, to 0% and deference of VAT when the project goes into production stage.
Largo operates as a Canadian explorations and development business focused on non-precious metals. The company owns three projects in Brazil and one in Canada. Largo holds a 90% interest in Maraca project and expects to develop it by the first quarter of 2013.
