Navitas board recommends new Jones/BHG bid
The Navitas board has announced it intends to recommend a revised $2.1bn takeover bid from the BGH Consortium, which includes former chief executive and co-founder Rod Jones, to its shareholders.
The new proposal sees an all-cash offer of A$5.825 per share, a 32% increase from the consortium’s offer of $5.50 on 9 October 2018, which was rejected by the board. An alternative offer of $2.75 per share and a share in the newly formed and privately listed RollCo has been removed.
“We believe these are important enhancements for Navitas shareholders”
“The Navitas Board has consistently sought to deliver a good result for all shareholders, while continuing to deliver value for our partners and our students,” Navitas chairman Tracey Horton said.
“There’s still a fair way to go to get to a completed transaction, but the board is comfortable to recommend this proposal given the price and terms that are now on the table.”
In its ASX statement, Navitas said the new proposal better reflected the medium and long-term potential of the company, one of the factors outlined during the rejection of the original offer.
Under the new arrangement, the consortium’s restriction to prevent both Jones and fellow consortium member AustralianSuper from voting or supporting any competing offers has also been lifted.
“This new proposal delivers an improved price and also provides the potential for Rod Jones and AustralianSuper to support a superior proposal if BGH choose not to match,” Horton said.
“We believe these are important enhancements for Navitas shareholders.”
The offer now enters its due diligence period, however, reports indicate it is unlikely there will be any significant barriers to proceeding further.
The new offer is the latest in a bid by Jones and BGH to takeover Navitas which has been tumultuous at times.
Since the initial offer in October 2018, Navitas and Jones have clashed on several occasions, with the latter asked to retire from his position as a director after comments made to The West Australian.
Shortly after Navitas rejected the original offer in November 2018, Jones was part of a bid by shareholders to depose Horton of her position as chair, which she survived 50.8% to 49.2%.
News of the board’s intentions drove Navitas’ share price up by more than $0.60, jumping from around $4.90 to a high of $5.56 on Wednesday.