Alimentation Couche-Tard’s Pursuit of Seven & i

Alimentation Couche-Tard’s Pursuit of Seven & i

Alimentation Couche-Tard remains steadfast in its pursuit of a deal with Japan’s Seven & i, according to CEO Alex Miller. Miller emphasized the company’s commitment to a “friendly approach” in its efforts to acquire the 7-Eleven operator. This stance aligns with previous statements made by Couche-Tard’s chairman and co-founder, Alain Bouchard, who ruled out a hostile takeover bid.

Initial Bid and Subsequent Revision

In August 2022, Couche-Tard initiated contact with Seven & i, offering $38.5 billion in exchange for acquisition. After Seven & i rejected the initial bid, Couche-Tard raised its offer to $47 billion. Miller reiterated the company’s belief in the “strong opportunity to grow together” with Seven & i and expressed confidence in their ability to secure financing and complete the merger.

Concerns from Seven & i

Seven & i has expressed reservations regarding the deal. The company has stated that it does not believe the offer is in the best interests of its shareholders. Additionally, concerns have been raised about potential antitrust issues in the United States, where both companies have a significant presence.

Competing White-Knight Bid

In a separate development, Seven & i has received a potential white-knight bid of $58 billion from Ito-Kogyo, a company linked to Vice President Junro Ito, a major shareholder in Seven & i. This offer is being reviewed by the same special committee set up to consider Couche-Tard’s bid.

Couche-Tard’s Financial Strength

Couche-Tard is a financially robust company with a strong balance sheet. The company’s revenue exceeds $50 billion annually, and it has over 14,000 stores in 26 countries. This financial strength provides Couche-Tard with the resources to make a compelling offer for Seven & i and to pursue the deal with confidence.

Industry Significance

The potential acquisition of Seven & i by Couche-Tard would be a significant transaction in the convenience store industry. The combined entity would create a global powerhouse with over 55,000 stores and a presence in more than 30 countries. This would strengthen Couche-Tard’s position as the world’s leading convenience store operator and provide opportunities for growth and innovation.

Alimentation Couche-Tard remains persistent in its pursuit of a deal with Seven & i and is committed to a “friendly approach.” While concerns exist and a competing bid has emerged, Couche-Tard’s financial strength and belief in the strategic value of the merger put it in a strong position to negotiate and potentially acquire Seven & i. The outcome of these negotiations will have significant implications for the convenience store industry worldwide.