Navitas directors have recommended shareholders accept an increased $2.1 billion takeover proposal by a consortium that includes its founder and former chief executive, Rod Jones, who says the new ownership would boost the company's prospects .
Navitas directors have recommended shareholders accept an increased $2.1 billion takeover proposal by a consortium that includes its founder and former chief executive, Rod Jones, who says the new ownership would boost the company's prospects .
The bidding consortium comprises Melbourne-based BGH Capital, Australian Super, and Mr Jones.
The latest proposal values the Perth-based firm at $5.83 per share, an 18.9 per cent premium on its last close and higher than the $5.50 bid made by the consortium last year, which valued the global education provider at $1.97 billion.
In a statement to the ASX, the company said its directors planned to unanimously recommend the improved offer, subject to the parties signing a binding scheme implementation deed on the same terms as the revised bid.
The consortium has indicated this revised offer will be its best and final.
Navitas has granted exclusive due diligence to the consortium until February 18.
Under the revised proposal, which is an all-cash offer, the consortium has agreed to amend the requirement for Rod Jones and Australian Super to vote against any competing proposal.
The Board said its assessment of the revised proposal was informed by its views of the medium and longer term potential of Navitas and the opportunity for shareholders to realise certain value for their investment.
It also noted BGH consortium's preparedness to lift the contractual restrictions on Mr Jones and AustralianSuper that would otherwise prevent them supporting any superior proposal that may emerge.
Mr Jones told Business News the improved offer was a compromise acceptable to both parties.
“We’ve reached a good point, though there’s still a lot of water to flow under the bridge with the due diligence process,” he said.
Mr Jones said the takeover offer was about more than money.
“I always felt BGH was the right partner to take the business forward,” he said.
“They have the right attitude to the business, they are focused on students, and they have a long-term approach.”
Mr Jones added he would not resume his old position.
“I am not looking to go back as an executive, but I will have a role as a non-executive director.”
He said it was premature to discuss operational changes, including the future of senior executives inside the business.
“To be honest, that hasn’t even been discussed.”
Goldman Sachs is acting as financial adviser and Ashurst is acting as legal adviser to Navitas, while BGH is being advised by Morgan Stanley and Gilbert + Tobin.
Investor relations firms FTI Consulting and Cannings Purple are acting for Navitas and Mr Jones respectively.
At the close of trade Navitas shares were up 12.9 per cent to $5.53, after peaking at $5.65 earlier in the day.
The peak represented its highest share price in over two years.
Operating in Australia, North America and Britain, Navitas posted its first annual loss in August 2018.
