Continuing the drama over a potential deal that is largely being negotiated through a series of public statements, Seven & i Holdings Co. Ltd., parent of the 7-Eleven convenience-store brand, on Monday responded to what it says is misinformation about its dealings with would-be acquirer Alimentation Couche-Tard Inc. (ACT), parent of the Circle K c-store brand. Tokyo-based Seven & i also detailed what it characterizes as “its constructive engagement” with Laval, Quebec-based Couche-Tard.
“We have been insistent on ensuring a clear path to antitrust regulatory approval as a first step for one reason,” the company said. “A deal that doesn’t close is not a deal, and it will destroy shareholder value. The board will not blindly enter into a transaction with no clear path to closing that could leave the company in a value destructive limbo for multiple years. We are confident this dual track approach is the best way for us to deliver to shareholders and other stakeholders the value they deserve.”
Among the highlights of the documents that Seven & i has released is a set of dual timelines detailing its own “good faith engagement” in relation to “ACT’s resistance and delays on antitrust.”
“On July 25, 2024, 7&i received an unsolicited, nonbinding proposal from ACT at a per share price of $14.86 per ordinary share, with no reference to antitrust challenges,” Seven & i said. “Since then, 7&i has consistently engaged in a constructive manner with ACT, focused on exploring the possibility of reaching a viable deal. ACT repeatedly refused to constructively address the real and relevant regulatory hurdles until February 2025.”
Seven & i also attempts to dispel the “myth” that the reason it is resisting the deal because it does not want to be owned by a foreign company.
“FACT: This assertion is categorically false,” Seven & i said. “We believe anyone implying that 7&i would reject a deal based on ACT’s origins is attempting to distract from the real issue: whether ACT’s proposal can close and deliver sufficient value for shareholders and other stakeholders as promised. Now that ACT is finally taking our antitrust concerns seriously, we will be able to determine if there is a path to aviable divestiture process by identifying potential buyers and determining their ability to stand up a real, standalone business that will preserve competition.”
View the full Seven & i documents here:
Couche-Tard declined to comment to a CSP inquiry on the matter. Previously, it launched a website, GrowingSeven.com, regarding a potential Seven & i acquisition .
Background
Last August, Couche-Tard submitted a bid of $39 billion to acquire Seven & i, which rebuffed the proposal twice, saying it “undervalues” the company. Couche-Tard in October raised its offer to $47.2 billion. And on Jan. 24, Couche-Tard submitted an revised, yen-denominated, nonbinding proposal at Seven & i’s request to confirm its “continued interest” in acquiring the company. It did not disclose the amount of this offer.
During a press conference in Tokyo on March 13, Miller—along with Couche-Tard founder and chairman Alain Bouchard and CFO Filipe Da Silva—said Couche-Tard could increase its offer to acquire Seven & i, but only if the company engages in talks.
Seven & i has proposed an initial public offering (IPO) for 7-Eleven in the United States and is exploring options for potential divestitures to minimize antitrust issues. Seven & i said it has identified “2,000 or more overlapping stores that could be divested to a viable, credible and independent buyer in a manner that could be stood up to operate effectively on a go-forward basis and assure competition between the buyer and [Couche-Tard] post its acquisition of Seven & i.”
Couche-Tard said it has talked with buyers for any U.S. stores that would need to be divested to secure regulatory approval for a potential acquisition. In a statement provided to to CSP Daily News, Couche-Tard said, “We have identified a potential divestiture portfolio of U.S. stores. In collaboration with Seven & i, and to provide further assurance, Couche-Tard is having exploratory discussions with third parties to identify potential acquirers.”
Potential buyers have until the end of March to express their interest and show they can overcome antitrust concerns, people familiar with the matter told Bloomberg late last week.
Meanwhile, Seven & i is pursuing “two parallel paths” to ensure and maximize value, it said. It is “working closely with ACT to explore the possibility of a viable divestiture path to ensure that any potential sale transaction can be completed if agreed upon,” as well as a “standalone plan of management initiatives.”
Seven & i operates convenience stores, superstores, supermarkets, specialty stores, foodservices, financial services and IT services. Irving, Texas-based 7-Eleven Inc. operates, franchises or licenses more than 83,000 convenience stores in 19 countries and regions, including more than 13,000 7-Eleven convenience stores in the United States and Canada.
Alimentation Couche-Tard operates in 31 countries and territories, with more than 16,700 stores. Its network includes more than 7,100 stores in the United States, primarily under the Circle K banner.
7-Eleven is No. 1 on CSP’s 2025 Top 40 update to the2024 Top 202 ranking of U.S. c-store chains by store count. Alimentation Couche-Tard is No. 2. Watch for the full 2024 Top 202 ranking in the June issue of CSP magazine and in CSP Daily News.
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