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This chain was supposed to fight with Żabka. Now it is negotiating with the Canadians

Ta sieć miała powalczyć z Żabką. Teraz negocjuje z Kanadyjczykami
  • Japanese retail giant Seven & i Holdings has rejected an offer from Canadian group Alimentation Couche-Tard.
  • The Canadians wanted to take over the company for $38.5 billion (34.65 billion euros) in cash.

Mass layoffs in a large company. 1.8 thousand people will lose their jobs

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Mass layoffs in a large company. 1.8 thousand people will lose their jobs

The 7-Eleven chain said the takeover proposal was “not in the best interests of shareholders” and would likely face “significant antitrust challenges” in the U.S. In the U.S., the entity would become the largest player in the convenience store industry.

7-Eleven Rejects Alimentation Couche-Tard Offer. Will There Be a Second Offer?

Seven & i, which announced last month that it had received an offer from Circle-K owner Couche-Tard, revealed the offer was $14.86 (€13.37) per share , adding that the company was willing to “sincerely consider” any offer.

However, the company stressed that it would "resist any proposal that deprives shareholders of the company's intrinsic value and fails to address genuine regulatory concerns."

"For several key reasons, we do not believe that the proposal you have presented provides a basis for engaging in meaningful discussions about a potential transaction," Stephen Dacus, chairman of a special committee of Seven & i's independent directors appointed to consider Couche-Tard's offer, wrote in a letter to bidders.

Incoming Couche-Tard CEO Alex Miller said during an earnings conference call that Couche-Tard is confident in its ability to finance the transaction.

Seven & i shares traded at 2,133.5 yen ($14.99/€13.49), slightly above the offer of $14.86 (€13.37) per share.

Couche-Tard shares have fallen about 8% since the Seven & i takeover bid went public.

Seven & i fears rejection by antitrust authorities

The Japanese company said that even if Couche-Tard significantly increased its offer, it would still be concerned about whether the takeover could go through and whether antitrust authorities would approve such a merger.

Travis Lundy, an independent analyst, said it still appears Couche-Tard has room to improve its offer. “It was a first strike. Everyone knows it wasn’t their last and best offer and it wasn’t fully fleshed out.”

Although Seven & i is significantly larger than Couche-Tard in sales, stores and employees, its stock has underperformed for years. Investors have complained, among other things, about poor management.

Despite the rejection, Couche-Tard's offer is another example of the growing interest of Western investors in Japanese companies.

7-Eleven is the largest convenience store operator in the US with a 14.5% market share in 2023, while Couche-Tard brands had a 4.6% share (data from analytics and consulting firm GlobalData).

The case was described by the portal esmmagazine.com

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