Largo Inc (NASDAQ:LGO) shares dropped 8% on Thursday after the vanadium producer announced a new at-the-market (ATM) share offering that could lead to dilution for existing investors.
Under the program, Largo can issue and sell up to $60 million of common stock on The Nasdaq Stock Market, with H.C. Wainwright & Co., LLC acting as the sole sales agent. Any shares sold would be priced at prevailing market levels at the time of issuance.
The company emphasized that participation in the program is entirely discretionary, noting that it is not required to raise the full amount and can pause or end the ATM offering at any point. Proceeds from any share sales are expected to be directed toward working capital needs and broader corporate purposes.
Management said the ATM structure gives Largo added flexibility to tap equity markets when conditions are favorable, rather than committing to a single, fixed financing event. The offering will be carried out under a prospectus supplement and base shelf prospectus filed with the U.S. Securities and Exchange Commission, with no shares to be sold in Canada or via the Toronto Stock Exchange.
Largo operates the Maracás Menchen Mine in Brazil and positions itself as a global supplier of high-purity vanadium and ilmenite products, which are used in industries ranging from steelmaking and aerospace to chemicals, defense and energy storage.