By Anton Bridge and Abigail Summerville
TOKYO (Reuters) -Canada’s Alimentation Couche-Tard on Tuesday said it is confident there is a “clear path” to overcome U.S. regulatory hurdles in its proposed $47 billion acquisition of Japan’s Seven & i, and expressed frustration at the 7-Eleven owner’s “limited engagement.”
The Circle-K owner has been pursuing Seven & i for months even as it received a frosty reception from the Japanese retail giant.
“We have reiterated several times over the past few months that we intend to be friendly and persistent in pursuing a transaction,” Couche-Tard said in a statement, rejecting the Japanese firm’s position that the potentially transformational deal faces major regulatory hurdles.
“We have done that in the face of significant frustration and distraction,” it added.
In some of its most detailed public comments yet, Couche-Tard said it had been working with Seven & i over a plan to divest some of their stores in the United States if the deal were to go through.
The comments are the latest salvo in what would be Japan’s largest foreign buyout in history, and contradict Seven & i’s newly appointed CEO Stephen Dacus, who has reiterated that significant regulatory hurdles stand in the way of a merger.
The companies are the top two players in the U.S. convenience-store market, with about 20,000 locations between them.
“We firmly believe there is a clear path to regulatory approval in the U.S.,” Couche-Tard said, adding they “continue to be disappointed that engagement has been very limited.”
Seven & i did not immediately respond to a request for comment.
Couche-Tard, which operates the Circle-K chain of convenience stores, said it had identified a portfolio of U.S. stores to potentially offload and had begun talks with prospective buyers at the behest of Seven & i.
In recent weeks, both Seven & i and Couche-Tard have reached out to potential buyers, including both strategic buyers and private equity firms, to gauge interest in the divestiture package, a person familiar with Seven & i’s deliberations said.
Couche-Tard needed to find a clear divestiture path that identifies specific stores, a time frame, and a credible buyer, before it considers sharing confidential information with its competitor, the person added.
The Canadian suitor in late December submitted a proposal to the Japanese company outlining the commitments it was willing to make to meet U.S. regulatory approval and secure the deal. Those included the number of stores it was willing to divest and a large termination fee.
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7-Eleven parent company announces major changes
DALLAS — In a shakeup, 7-Eleven’s Japanese parent company announced it’s getting a new CEO and says it plans to hold an initial public offering of its North American convenience store business.
Seven & i Holdings, 7-Eleven’s parent company, announced Thursday that Stephen Hayes Dacus, who currently serves as the company’s board chair, will be appointed its CEO. Dacus will take over as the company’s CEO in May.
In a press release, Seven & i Holdings says it’s planning to hold an initial public offering of its North American convenience store business, which includes 13,000 stores in the U.S. and Canada, by the second half of 2026.
“The Board is confident that an IPO at this time is the best path to unlock significant value for Group shareholders and position SEI [7-Eleven Inc.] for accelerated growth,” a press release read. “This step will create two independent public companies while maintaining synergies with the Company, as the Company retains majority share of SEI. An independent SEI will have increased financial flexibility and greater decision-making autonomy to capitalize on its market leadership as the largest convenience store chain in the attractive North American market.”
WFAA has reached out to 7-Eleven Inc. for comment on the plans.
Seven & i Holdings is also selling its superstore unit to Bain Capital for $5.37 billion, and the sale is expected to close in September.
The shakeup comes as Seven & I Holdings fights a reported $47 billion takeover bid from the Canadian-based owner of rival convenience store chain Circle K, Alimentation Couche-Tard Inc.
“The Special Committee has been committed to exploring all value creation opportunities, including active and constructive engagement with ACT, and will continue to do so,” Dacus said in a statement Thursday. “The initiatives management has announced today are crucial steps in simplifying our Group structure and unlocking shareholder value.”
Last week, a bid by Junro Ito, vice president and a representative director of 7&I (and a member of Seven & I’s founding family) and Ito-Kogyo Co. to acquire 7&I fell through after they failed to secure the necessary financing.
“7&i remains committed to exploring all opportunities to unlock value for shareholders and continues to assess a full range of strategic alternatives, including the proposal from Alimentation Couche-Tard, Inc. (“ACT”). The Special Committee is engaging constructively with ACT to determine if an actionable proposal can be achieved that addresses the serious U.S. antitrust challenges that any such transaction would face,” Seven & i said at the time.
