Couche-Tard presses 7-11 owner for talks over $38.5 bln takeover

STORY: Retailer Alimentation Couche-Tard isn’t giving up on its bid to take over Japan’s Seven & i - owner of the 7-11 convenience store chain.

The Canadian firm said Sunday it remained keen on pursuing a buyout, and wanted confidential talks.

Seven & i has so far rejected the $38.5 billion offer.

It says the deal is not in the best interest of shareholders, and would run foul of antitrust watchdogs.

Couche-Tard, which owns the Circle K brand, says it could address those worries by divesting some assets.

It said it was confident of arranging finance for the bid, which would be the largest-ever foreign takeover of a Japanese company.

It would also be the biggest all-cash offer for any firm since Elon Musk bought Twitter for just over $40 billion in 2022.

By Monday lunchtime, Seven & i stock was up over 2%.

That put it above the $14.86 per share offered by Couche-Tard.

The Japanese company has said even a significantly bigger offer wouldn’t convince it.

Seven & i is much larger than Couche-Tard in terms of sales, stores and employees.

Yet its shares have underperformed for years, amid criticism of its structure and corporate culture.

Couche-Tard, meanwhile, is valued much more highly, at around $52 billion.

Now a takeover could massively expand its global reach and economies of scale.

But one analyst told Reuters it would be hard to do the acquisition at a bargain price, with many investors aware of Seven & i’s real potential value.