KPL/KYODO NEWS: Japanese retail giant Seven and i Holdings Co. announced its consideration of a management buyout proposed by a founding family member, potentially thwarting a takeover bid from Canadian convenience store giant Alimentation Couche-Tard Inc.
According to Lao News Agency, the development suggests that the Japanese operator of the Seven-Eleven convenience store chain may go private, amidst a takeover battle with Couche-Tard, whose latest offer is estimated at around 7 trillion yen ($45 billion). The proposed management buyout by Seven and i Vice President Junro Ito could exceed 6 trillion yen, potentially marking it as Japan’s largest ever.
A press release on Wednesday revealed that the company received a nonbinding and confidential acquisition proposal from Ito and an affiliated company, Ito-Kogyo Co. Stephen Dacus, a director at Seven and i and head of a special committee reviewing the matter, stated the company is “committed to an objective review of all alternatives,” considering prop
osals from both Ito and the Canadian operator of Circle K convenience stores.
The special committee and the board will continue engaging with all parties to maximize value and act in the best interests of shareholders and stakeholders, Dacus assured. Seven and i is anticipated to secure funding from the Ito family and major banks to facilitate the management buyout. There is also speculation of potential investment from Itochu Corp., a major Japanese trading house and parent of FamilyMart Co.
In September, Seven and i declined Alimentation Couche-Tard’s proposal to buy all outstanding shares for $14.86 per share in cash, or roughly $39 billion, citing that it “grossly undervalued” the company. In October, the company admitted receiving a new proposal from the Canadian company, reportedly 20 percent higher than the previous bid, yet remained hesitant to accept.
Alimentation Couche-Tard, operating brands including Couche-Tard and Circle K, manages about 17,000 stores across over 30 countries, including C
anada and the U.S., while Seven and i operates over 80,000 Seven-Eleven stores globally. Earlier this year, Japan’s largest management buyout involved Taisho Pharmaceutical Holdings Co. being taken private for 710 billion yen.