Navient rejects $3.2 billion takeover bid from Canyon Capital and Platinum Equity

• Navients board voted on Monday to reject the $12.50 per share offer from hedge fund Canyon Capital Advisors and private-equity firm Platinum Equity Advisors.
• The offer represents a 6.6 percent premium over Navients Friday closing price of $11.73 a share.

Mitch Julis, co chief executive officer of Canyon Capital Advisors LLC, speaks during the Milken Institute Global Conference in Beverly Hills, California, on Tuesday, May 2, 2017.

Patrick T. Fallon | Bloomberg | Getty Images

Student-loan servicer Navient has rejected a $3.2 billion takeover bid from two investors as it believes the offer undervalues the company.

Navients board voted on Monday to reject the $12.50 per share offer from hedge fund Canyon Capital Advisors and private-equity firm Platinum Equity Advisors.

The offer represents a 6.6 percent premium over Navients Friday closing price of $11.73 a share.

The $12.50 per share offer was surprisingly lower than the $14 to $15 informal price range Canyon's advisers had given Navient during talks, Navient's chairman, William Diefenderfer, said in a statement.

The Wilmington, Delaware-based company recently ran into trouble with regulators over its business practices.

The company was accused by the U.S. Consumer Financial Protection Bureau of cheating hundreds of thousands of borrowers out of loan relief, telling a federal court the bureau did not identify even one such borrower.

Navient said it would consider any proposal in the future if it reflected the fair value of the company.