Seven & I Holdings, the Tokyo-based operator of the globally recognized 7-Eleven convenience stores, has declined a $38.5 billion acquisition proposal from Alimentation Couche-Tard, the Canadian company behind Circle K. The offer, which valued Seven & I’s stock at $14.86 per share, was rejected as being too low, with the Japanese company emphasizing that the bid did not adequately reflect the value of its business nor address the significant regulatory challenges that the merger would face.
Seven & I stated in a press release on Friday that while it remains “open” to considering any proposal that benefits its shareholders, it would resist any bid that undermines the company’s worth. “We will reject any proposal that deprives our shareholders of the intrinsic value of our company or fails to adequately address the serious regulatory hurdles involved,” the company said.
The acquisition offer, if successful, would have marked the largest foreign-led takeover of a Japanese firm in nearly 30 years, according to Dealogic, and the largest cross-border merger of 2023. The proposed deal would have dramatically increased Couche-Tard’s reach, adding 7-Eleven’s global presence of more than 83,000 stores to its existing footprint across North America and Europe. Analysts believe the combined entity could have commanded close to 20% of the U.S. convenience store market, a concentration likely to raise red flags with American antitrust regulators.
Seven & I, which acquired the Speedway chain of gas stations in the U.S. for $21 billion in 2021, already has a substantial presence in North America. The company noted that Couche-Tard’s bid did not sufficiently account for the hurdles posed by competition laws in the U.S., where regulatory authorities are increasingly focused on preventing monopolistic practices.
Since the news of the offer surfaced last month, Seven & I’s stock price has surged, driving the company’s market valuation past $38 billion. Despite the rejection, reports suggest that the Japanese firm could still entertain future offers, especially if Couche-Tard comes back with a higher bid.
The proposed takeover is being closely watched in Japan, particularly as it comes in the wake of recent reforms to corporate governance rules aimed at making the country more attractive to foreign investors. These changes have made it more difficult for companies to dismiss unsolicited takeover bids, reflecting a shift towards a more open and competitive corporate landscape.
Although 7-Eleven originated in Dallas, Texas, it was the visionary leadership of Japanese entrepreneur Masatoshi Ito that transformed the company into a global behemoth. Ito’s death in 2022 marked the end of an era for the brand, which remains one of the world’s most recognizable convenience store chains.
