Japanese retail giant Seven & i Holdings, the operator of the renowned 7-Eleven convenience store chain, has confirmed receipt of a preliminary takeover offer from Canadian firm Alimentation Couche-Tard. The news of this proposal has resulted in a significant surge in Seven & i’s stock price, climbing by 22.7% to hit the daily trading limit of 400 yen, elevating its market capitalization to 5.6 trillion yen ($38 billion). In comparison, Couche-Tard currently boasts a market valuation of approximately $58 billion.
Acknowledging the offer, Seven & i has established a special committee to assess the bid, although no definitive verdict has been reached by either the committee or the board of directors at this stage. Alimentation Couche-Tard has refrained from immediate comments outside of regular business hours.
Insiders familiar with the matter have indicated that discussions between the two companies are in their nascent phase, suggesting that negotiations are still at an early stage. If the acquisition proceeds as planned, it would mark the largest buyout of a Japanese entity by a foreign corporation, as reported by the Nikkei business daily, which initially broke news of the proposal.
Notably, both Seven & i and Couche-Tard were competitors in a bid to acquire the U.S. gas station chain Speedway in 2020, with Seven & i emerging as the successful purchaser with a $21 billion deal.
Seven & i has faced pressure from activist investors to divest underperforming assets and concentrate on bolstering its global convenience store business, particularly centered around its flagship 7-Eleven brand. The potential acquisition by Alimentation Couche-Tard could signify a significant development in the ongoing evolution of both companies’ strategic priorities.
It will be crucial to monitor developments in this bid as the companies navigate through the evaluation process and potential negotiations moving forward.
