7-Eleven Parent Rejects $39 Billion Buyout Offer By Circle K Owner — Update

By Megumi Fujikawa

TOKYO--Seven & i Holdings has rejected an offer by Canada's Alimentation Couche-Tard, saying that the near $39 billion deal undervalued the 7-Eleven convenience store operator.

Seven & i said Friday that the offer "significantly" underestimated the value of the company and its potential. The proposal also lacked consideration of important regulatory issues, including U.S. competition hurdles, it added.

Alimentation Couche-Tard offered to acquire all outstanding shares of Seven & i at $14.86 per share in cash, according to Seven & i. That would have put the value of the deal at about $38.7 billion.

"We are open to sincerely consider any proposal that is in the best interests of Seven & i shareholders and other stakeholders," the Japanese company said in a letter to the Canadian owner of Circle K convenience stores.

"However, we will resist any proposal that deprives our shareholders of the company's intrinsic value or that fails to specifically address very real regulatory concerns."

Seven & i said Couche-Tard's offer didn't mention the level of divestitures needed or the timeline required to clear regulatory hurdles.

A Couche-Tard representative didn't immediately respond to a request for comment.

In late August, Seven & i said it set up a special committee of outside directors headed by veteran retail executive Stephen Hayes Dacus to examine the offer.

Couche-Tard's offer came as Seven & i has faced pressure from some foreign shareholders in recent years. In response, Seven & i has been trimming some businesses and focusing more on its profitable convenience stores.

Seven & i shares swung after Friday's announcement. The company's stock price fell 0.5% at 2,153.5 yen, the equivalent of $15.01, after rising to 2,208.0 yen earlier.

Write to Megumi Fujikawa at megumi.fujikawa@wsj.com

(END) Dow Jones Newswires

September 05, 2024 21:59 ET (01:59 GMT)

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