Tokyo, Japan-based retail firm Seven & i Holdings is fending off a buyout offer from Laval, Quebec, Canada-based convenience store company Alimentation Couche-Tard by considering a competing buyout offer from a member of its own management and spinning off business units.
Seven & i Holdings, which owns the Ito-Yokado, York-Benimaru, and 7-Eleven Japan supermarket chains, achieved total sales in its 2023 fiscal year of JPY 17.78 trillion (USD 112 billion, EUR 109 billion), which totaled the seventh-highest among retailers worldwide during the period, according to the group. The company also achieved revenue of JPY 11.47 trillion (USD 72 billion, EUR 70 billion) in the period.
Couche-Tard, which is the parent company of the Circle K convenience store chain, announced a preliminary bid of about USD 39 billion (EUR 36 billion) for Seven & i in August 2024, which was rejected as too low by Seven & i’s management.
In September, potentially as a way to guard itself against the sale, Seven & i requested and received a classification of being “core” to national security on a Japan Finance Ministry list. This would require any foreign entity seeking to buy a stake of 1 percent or more to file for a national security review with the Japanese government.
In October, Couche-Tard raised its offer to around USD 47 billion (EUR 44.5 billion).
Then, in November, Seven & i received a competing USD 58 billion (EUR 55 billion) management buyout offer from its vice president, Junro Ito, and his affiliated company, Ito-Kogyo Co. Ltd., which holds 8.1 percent of Seven & i Holdings.
Seven & i has formed a committee to study both proposals.
In the meantime, to focus more heavily on its core convenience store operations, Seven & i Holdings plans to spin off its supermarket business into a separate subsidiary called York Holdings and sell off the majority stake in it by February 2026.
Beyond the issue of who will gain control of Seven & i, the competition also tests Japan’s revised Corporate Governance Code and the Financial Services Agency's Stewardship Code that call for reducing the influence of management-controlled boards that have insulated companies from accountability to shareholders.
The outcome of the buyout may set a precedent for similar occurrences in Japan in the future.
