7-Eleven Owner Seven & i Considers Management Buyout

Seven & i Holdings, owner of the 7-Eleven convenience store chain, said Wednesday (Nov. 13) that it received a proposal for a potential management buyout.

The non-binding and confidential proposal to acquire the company came from its vice president and representative director, Junro Ito, and a private company affiliated with him, Ito-Kogyo, Seven & i Holdings said in a Wednesday press release.

The company said in the release that a special committee is reviewing the proposal; Ito has been excluded from all discussions within the company relating to his proposal, that of Alimentation Couch-Tard (ACT) or any other competing proposals; and no decision has been made to pursue any transaction.

“We are committed to an objective review of all alternatives before us as we consider proposals from Mr. Ito and Ito-Kogyo, from ACT, as well as the company’s stand-alone opportunities to unlock shareholder value,” Stephen Hayes Dacus, chair of the special committee and board of directors of the company, said in the release. “The special committee and the company board will continue to engage with all parties in a manner designed to maximize value and will continue to act in the best interests of the company’s shareholders and other stakeholders.”

The buyout proposal from Ito, who is a member of Seven & i’s founding family, and Ito-Kogyo would allow Seven & i to continue under current management, remove pressure from shareholders and eliminate the threat from ACT, which it may view as a hostile bidder, Reuters reported Wednesday.

Seven & i has been under pressure from shareholders for years, with some seeking a break-up of the company, because its supermarkets have performed poorly even as its 7-Eleven stores have been successful, according to the report.

The pressure increased when Couche-Tard, the owner of Circle K convenience stores, launched a takeover bid in August, per the report.

It was reported in September that the Federal Trade Commission (FTC) told Seven & i that it intended to investigate a potential acquisition of 7-Eleven by Couche-Tard due to antitrust concerns.

The proposed takeover is expected to face scrutiny in Japan as well, as it could come under review under the country’s Foreign Exchange and Foreign Trade Act.