Canadian convenience store giant Alimentation Couche-Tard has announced a takeover proposal for Seven & i Holdings. The acquisition price is expected to exceed ¥5 trillion, which could make it one of the largest acquisitions of a Japanese company by a foreign company if completed.
Seven & i Holdings announced on the 19th that it had received a takeover proposal from Canadian convenience store giant Alimentation Couche-Tard. Couche-Tard operates Circle K and Couche-Tard-branded stores, with approximately 17,000 locations in 31 countries, mainly in North America and Europe. Its revenue totals $69.2 billion, and the acquisition price is expected to exceed ¥5 trillion.
Following the proposal, Seven & i said it would establish an independent committee and respond after careful and prompt consideration. In response, Seven & i's share price surged ¥400 from the previous day to ¥2,161 on the 19th, reaching its daily limit.
Kazehaya Takahiro (風早 隆弘) of UBS Securities said that M&A would be necessary for Couche-Tard to strengthen its presence in the North American market, and that choosing Seven & i as its largest acquisition target was a strategy aimed at creating synergies with its North American business.
While gasoline sales account for 74% of Couche-Tard's revenue, some observers believe that Seven & i Holdings has not aggressively pursued stores located alongside gas stations. Experts say the deal has a low likelihood of being completed because of differences in the companies' growth strategies, and it is seen as being aimed at expanding Couche-Tard's share of the North American market.