IRVING, Texas – The convenience store Japanese company 7-Eleven has turned down a $38 billion acquisition proposal from the Canadian Alimentation Couche-Tard. Seven & i Holdings stated that the bid from the Circle K owner significantly undervalued the business and posed considerable regulatory challenges. Despite this, the 7-Eleven owner indicated it is still open to discussions and would be willing to entertain an improved offer. If the deal were to go through, it would result in a massive global convenience store chain with 100,000 locations.
7-Eleven turns down $38 billion acquisition proposal
Stephen Dacus, chair of the Seven & i board overseeing the potential acquisition, stated that the offer “grossly undervalues” the Japanese retail giant and its future capacity to deliver greater value to shareholders.
Alimentation Couche-Tard (ACT), a Quebec-based firm operating around 17,000 stores across North America, Europe, and Asia under the Circle K and Couche-Tard banners, initially offered to purchase Seven & i at $14.86 per share, which represented a premium of over 20% compared to the company’s share price prior to the bid.
The offer emerged at a time when the Japanese yen was notably weaker against the US dollar, making Seven & i a more attractive target for international buyers. However, in its rejection, Seven & i highlighted multiple and significant challenges that the deal would face from US competition authorities.
With 85,000 stores spread across 20 countries and regions, 7-Eleven remains the largest convenience store chain in the world.
A deal of this magnitude, involving a foreign purchase of a major Japanese company, would be unprecedented.
Neil Newman, head of strategy at Astris Advisory Japan, remarked, as stated by BBC News: “Japan needs to safeguard its national assets and Seven & i is one such asset, so we can expect prolonged negotiations.” He added that if the deal goes through, it could signal Japan’s openness to foreign investment.
Should the acquisition succeed, ACT’s presence in the US and Canada would more than double to approximately 20,000 locations.
