10 October 2018 Unsolicited, preliminary, conditional and...

10 October 2018

Unsolicited, preliminary, conditional and non-binding proposal

Navitas Limited (NVT: ASX) (“Navitas” or “the Company” today announced that after the market closed on 9 October 2018 it received an unsolicited, preliminary, conditional and non-binding proposal from BGH Capital Pty Ltd (“BGH”, AustralianSuper Pty Ltd as trustee for AustralianSuper (“AustralianSuper” and Mr Rodney Jones, (together, “BGH Consortium” to acquire 100% of the outstanding shares in Navitas by way of a scheme of arrangement (the “Indicative Proposal”. The Indicative Proposal would offer Navitas shareholders $5.50 cash per Navitas share, which represents:

 a 26% premium to the closing share price on 9 October 2018;  a 25% premium to the 3 month volume weighted average price (VWAP);  an 18% premium to the 12 month VWAP; and  a 2% discount to the highest closing price over the last 52 weeks.

The indicative price would be reduced by the value of any dividends or other distributions declared, proposed or paid after 9 October 2018. The Indicative Proposal would also offer Navitas shareholders an alternative such that they could receive consideration of:

 $2.75 cash per Navitas share; and  one ordinary share in a newly formed unlisted company that will initially own Navitas (“RollCo” for every two shares held in Navitas.

The cash and scrip alternative above would be subject to both a minimum and a cap such that the total number of shares rolled over (excluding any shares rolled by the BGH Consortium members) is at least 5% and does not exceed 15% of the post-acquisition equity in RollCo (subject to pro rata scale back to the extent that elections for the cash and scrip alternative exceed the cap).

BGH has entered into a cooperation agreement with AustralianSuper and Mr Jones who hold 5.4% and 12.6% of Navitas’ total shares respectively (a copy of this agreement will be lodged with the ASX by the BGH Consortium). Pursuant to the cooperation agreement, Mr Jones has agreed with the other BGH Consortium members that he would sell 50% of his shares for cash and roll over his remaining 50% shareholding into RollCo.

Given Mr Jones' involvement in the BGH Consortium, the Navitas Board is putting in place formal protocols in relation to Mr Jones’ access to information, employees, and attendance at Board meetings. The Indicative Proposal is subject to a significant number of assumptions and conditions, which are outlined in Appendix A. The Navitas Board has not yet formed a view as to the merits of the Indicative Proposal and together with its financial adviser Goldman Sachs and legal adviser Ashurst, will conduct a detailed review of the Indicative Proposal and will inform shareholders of the outcome of this review in due course.