Canadian retailer Alimentation Couche-Tard announced on Thursday the withdrawal of its $47 billion bid to acquire Seven & i Holdings, citing a lack of constructive engagement from the Japanese company. This move ends what could have been the largest foreign takeover of a Japanese firm, as Couche-Tard aimed to create a global convenience store giant through the acquisition of the operator behind 7-Eleven.
Couche-Tard voiced disappointment, accusing Seven & i of intentionally hiding facts and stalling the process, which they believe harmed shareholders. Seven & i also expressed their disappointment, denying any mischaracterizations while acknowledging the situation. The withdrawal of the bid is significant because Seven & i’s openness to foreign takeovers is seen as a test for corporate Japan, and it was overshadowed by Nippon Steel’s $14.9 billion deal with U.S. Steel. After the announcement, shares fell by 9%.
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Industry experts and investors expressed disappointment. Manoj Jain, co-founder and co-CIO of Maso Capital based in Hong Kong, remarked that the company’s apparent reluctance to engage impeded the deal, despite the perceived value of a combination for shareholders. Couche-Tard had previously increased its offer to around $47 billion last year and had offered to boost it further if Seven & i provided more financial transparency and cooperation. They also worked with Seven & i on a store sale plan to address regulatory hurdles.
Negotiations stalled because Couche-Tard pointed to limited due diligence, management meetings, and the collapse of a white-knight bid from Seven & i’s Ito family, primarily due to financing problems. Couche-Tard suggested acquiring all of Seven & i’s international operations and a 40% stake in its Japanese domestic business, which is vital for disaster response.
