SEGI ... Apr12

US-based Navis Capital is now a major shareholder of SEG International Bhd (SEGi) following its acquisition of a 21.53% stake. The Asia-focused private equity firm bought 114.8 million shares from Cerahsar Sdn Bhd, which has ceased to be a shareholder of SEGi.

A total of 209.6 million shares changed hands in the education provider in off-market deals priced at RM1.71 apiece on 30 March 2012..

Speculation that there is some kind of a deal in the offing for SEGi such as a privatisation or a takeover.

A general offer (GO) may be announced for education provider SEG International Bhd by as early as the end of mid April 2012 should issues between interested stakeholders and Navis Capital Partners Ltd, which recently became the second largest shareholder, be ironed out.

A GO was a very real possibility but it would depend on a number of factors. The bottomline is that if the parties cannot agree on certain areas of concern, then the GO will be deferred by a few months. These issues include board-level representation, the level of management control Navis wants and key performance indices.

Sources also did not rule out Navis bringing in SEGi group managing director Datuk Seri Clement Hii, the Employees Provident Fund (EPF) or another government-linked investment company (GLIC) as joint offerors in the GO.

Hii remains SEGi's largest shareholder with a 29.8% stake but if warrants were included, his stake on a fully-diluted basis would be 32.5%. Navis, a private equity firm, acquired a 27.84% stake.

The price of RM1.71 per share was about right but to entice other shareholders, the GO price would have to be higher.

The source said the EPF's or GLIC's participation in the GO had not been firmed up.

Hii dismissed all speculation about him cashing out or acquiring more shares as a defensive move against Navis.