Navitas shares soar on back of improved offer

SHARES in adult education provider Navitas have hit a two-year high after it received a sweetened $2.09 billion buyout offer.

The new proposal's from a consortium made up of its founder and major shareholder Rod Jones and private equity firm BGH values the company at $5.825 per share.

That is an 18.9 per cent premium to its close on Monday and 32.5c higher than the first bid made by the consortium last year.

Navitas, which teaches English to migrants, said its directors plan to unanimously recommend the improved offer.

The bidding consortium also includes the nation’s biggest superannuation fund, AustralianSuper.

“The board’s assessment of the revised proposal has been 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,” Navitas said yesterday.

The Perth-based education provider spurned BGH’s earlier offer, saying it undervalued the company and it was exploring other takeover options.

It also previously criticised BGH’s “lock up” bidding tactic where the private equity firm secured agreements from Mr Jones and AustralianSuper to vote against any rival proposals.

Mr Jones owns 12.4 per cent of the company while AustralianSuper has a 5.4 per cent stake.

The Navitas board yesterday said it was supporting the new proposal given BGH was prepared to lift those “contractual restrictions”.

The move by the Navitas board to block the original bid sparked criticism from other major shareholders including fund manager Allan Gray.

The bid also created tension within the company.