7-Eleven Shares Jump After Couche-Tard Makes New Takeover Offer

Shares of 7-Eleven jumped after it received a new takeover offer from Canadian rival Alimentation Couche-Tard. Seven & i Holdings’ shares surged by almost 12% when the news broke but finished the day up by 4.7% at 2,335 yen, according to Reuters.

The outlet reported that two people familiar with the matter said Couche-Tard increased its bid to around $47 billion, which is 22% higher than its previous offer.

Japan’s Seven & i Holdings confirmed the news that the company made an offer but did not reveal any new details, explaining that the proposal was both private and non-binding.

If this takeover were to move forward, it would be the largest-ever overseas buyout of a Japanese firm. The new offer by the Canadian company was sent to the Tokyo-based owner of the 7-Eleven chain last month. However, no negotiations have taken place since, reports the Financial Times. If successful, the buyout would create a 100,000-strong global convenience store chain.

Who Is Couche-Tard?

Circle K's parent company has offered to buy 7-Eleven in a deal that would create the largest convenience store chain in the world

Alimentation Couche-Tard
• Stores: 16,000
• Market value: $55 billion

Seven & i Holdings
• Stores: 85,000
• Market value: $38 billion

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— Morning Brew ☕️ (@MorningBrew) August 19, 2024

Couche-Tard is Canada’s biggest convenience retailer. It operates convenience stores around the world under its own brand, as well as Circle K and Ingo. The company has a history of overseas expansion. For example, it bought around 2,200 gasoline stations in Europe from TotalEnergies SE for €3.1 billion last year. The company also tried to purchase Carrefour SA. However that bid was blocked by the French government. 

The Japanese group confirmed that 7-Eleven “received a revised confidential, private and non-binding proposal” from Couche-Tard and “intends to continue to maintain, the confidentiality of its current discussions with ACT at this time.”

Fortune quoted Amir Anvarzadeh, a strategist at Asymmetric Advisors, who said, “It all depends on the price, and I guess the weak yen has made it more attractive and anything north of ¥7 trillion, the management would have a tough time rejecting. But knowing the Seven & i management, you can bet on them resisting this if the price is lower.” 

On Sept. 9, Seven & i Holdings made the following statement in a press release regarding the original offer: “As our board has previously discussed and stated, we do not believe that the proposal ACT put forward provides a basis for us to engage in substantive discussions regarding a potential transaction. This is precisely why we have not asked our advisors to engage in further discussions or signed an NDA.”

The company continued, “We remain open to engaging in sincere discussions should ACT put forth a proposal that fully recognizes Seven & i’s standalone intrinsic value and addresses the Special Committee’s very real regulatory concerns. Unless and until ACT does so, Seven & i will focus on executing its business and pursuing the actionable avenues we see to realize and unlock shareholder value in the near- to medium-term.”

7-Eleven began in the United States. However, the franchise has been owned by Seven & i since 2005. 7-Eleven is the world’s biggest convenience store chain and operates more than 85,000 outlets globally.