After months of resistance, Seven & i Holdings has started preliminary talks with Canadian convenience store giant Alimentation Couche-Tard regarding a $47 billion takeover bid. This development arrives as a fresh, competing offer emerges from the founding Ito family, adding complexity to what could become Japan’s largest-ever corporate acquisition.
Three individuals familiar with the situation revealed that “preliminary and limited” discussions between the advisors of Seven & i and Couche-Tard have commenced. Couche-Tard’s interest in acquiring the world’s largest convenience store chain, 7-Eleven, dates back over 20 years, with its formal approach becoming public in August. If successful, the acquisition would mark a transformative milestone for Japan’s mergers and acquisitions market.
Founding Family Proposes Rival Bid
Even as discussions with Couche-Tard unfold, Seven & i disclosed on Wednesday that it received a rival “confidential and non-binding” buyout proposal led by Junro Ito, vice-president and son of the company’s founder, and Ito Kogyo, a company representing other family members. This potential “white knight” bid highlights the family’s desire to keep the Japanese retail giant under domestic control.
According to sources close to the matter, the Ito family’s bid would necessitate substantial financing from Japan’s top banks, supported by equity investments from a domestic firm. Currently, Ito Kogyo holds an 8.2% stake in Seven & i, per the company’s official records.
Challenges Facing Domestic Buyout Plans
One of Japan’s largest trading houses, Itochu, which already owns Family Mart, has been reportedly engaged in discussions regarding the Ito family’s proposal. However, any direct involvement could face regulatory hurdles, as Itochu’s control would mean a dominant 65% share of the Japanese convenience store market by sales. Mitsui & Co, another major trading house without existing ties to a convenience chain, has also been linked to potential involvement, though it has not confirmed any participation.
Special Committee’s Role in Evaluating Proposals
The special committee of Seven & i Holdings, led by Stephen Dacus, chair of the board, is currently evaluating the competing proposals. “We are committed to an objective review of all alternatives before us as we consider proposals from Mr. Ito and Ito Kogyo, from ACT, as well as the company’s standalone opportunities to unlock shareholder value,” Dacus stated on Wednesday.
This development underscores recent reports indicating the Ito family’s strong opposition to foreign ownership, fueling their active search for a domestic bidder to counter Couche-Tard’s advances.
Next Steps and Market Impact
The raised $47 billion bid from Couche-Tard in September followed an earlier unsolicited offer of $39 billion that was deemed insufficient by Seven & i’s board. This sets the stage for a potentially fierce bidding war that could reshape Japan’s retail sector.
Neither Couche-Tard nor the Ito family has responded to requests for comments on the situation. Seven & i Holdings has also declined to elaborate on the ongoing discussions.
