ARC Funds increase position in Largo Resources Ltd. pursuant to a private placement

/FOR DISSEMINATION IN CANADA AND OVER CANADIAN NEWS SERVICES ONLY/

TORONTO, Dec. 13, 2013 /CNW/ - Arias Resource Capital Fund II L.P. ("ARCF II") and Arias Resource Capital Fund II (Mexico) L.P. ("ARCF Mexico") completed the acquisition of a total of 75,000,000 common shares ("Common Shares") of Largo Resources Ltd. ("Largo") pursuant to the private placement previously announced by Largo in a press release dated November 29, 2013 (the "Private Placement"). The Common Shares were acquired at a price of CAD$0.20 per Common Share for aggregate consideration of CAD$15,000,000.00.

ARCF II acquired a total of 70,973,180 Common Shares of Largo at a price of CAD$0.20 per Common Share for consideration of CAD$14,194,636.07.

ARCF Mexico acquired a total of 4,026,820 Common Shares of Largo at a price of CAD$0.20 per Common Share for consideration of CAD$805,363.93.

As a result of this acquisition, ARCF II owns an additional 70,973,180 Common Shares, representing approximately 7.2% of the total outstanding Common Shares of Largo and ARCF Mexico owns an additional 4,026,820 Common Shares, representing approximately 0.4% of the total outstanding Common Shares of Largo.

This acquisition brings ARCF II's aggregate holdings of Common Shares to 140,531,742 representing approximately 14.3% of the total outstanding Common Shares of Largo and ARCF Mexico's aggregate holding of Common Shares to 7,973,378 representing approximately 0.8% of the total outstanding Common Shares of Largo, as at December 13, 2013. Arias Resource Capital Fund L.P. ("ARCF I") was not a participant in this Private Placement, but holds 105,803,230 Common Shares and holds warrants exercisable for an additional 17,834,210 Common Shares in Largo, representing approximately 12.4% of the total outstanding Common Shares of Largo, on a partially-diluted basis, as at December 13, 2013.

ARCF I, ARCF II and ARCF Mexico (collectively, the "ARC Funds") currently hold 254,308,350 Common Shares and 35,669,909 warrants in Largo expiring April 15, 2015. Accordingly the ARC Funds will be a "Control Person" of Largo (as defined in the TSX Venture Exchange Corporate Finance Manual).  At the annual and special meeting of the shareholders of Largo held on June 27, 2013, the shareholders approved the creation of the ARC Funds as a Control Person of Largo. Accordingly, on an aggregate basis, assuming the exercise of the warrants currently held, the Common Shares held collectively by the ARC Funds would represent approximately 28.5% of the total outstanding Common Shares of Largo, on a partially-diluted basis.

The ARC Funds are managed by Arias Resource Capital Management LP (the "Manager").  The respective general partner of each of the ARC Funds retains the power to make investment and voting decisions in respect of the Largo securities beneficially owned by the ARC Funds.  J. Alberto Arias is the sole director of each of the general partners of the ARC Funds and indirectly controls the Manager.  As such, Mr. Arias may be deemed to share voting and dispositive power with respect to the Largo securities beneficially owned by the ARC Funds, but he disclaims any beneficial ownership of any such securities, except to the extent of his pecuniary interest therein.

The Largo securities were acquired for investment purposes. The ARC Funds may, from time to time, acquire additional securities of Largo and/or dispose of such securities as they may deem appropriate.

This news release has been disseminated in accordance with the early warning requirements of Canadian provincial securities laws.

The dissemination of this release in the United States or to any United States news service may constitute a violation of U.S. securities laws.

SOURCE: Arias Resource Capital Fund II L.P.

Alberto Arias, Director, phone: [phone] e-mail: [email protected].