In August, 7-Eleven’s parent company Seven & i Holdings Co. received an acquisition proposal from Alimentation Couche-Tard (ACT). Seven & i Holdings rejected that offer, and ACT then upped its bid in a revised takeover offer.
In a recent interview with Bloomberg, ACT Chairman and Founder Alain Bouchard said that the company is interested in buying the entirety of Seven & i Holdings, with plans to keep the local operations of the Japanese convenience store intact.
He also noted that the company is confident in its ability to address anti-regulatory concerns with the U.S. Federal Trade Commission, stating that it has always been able “to have a great solution” in the past.
Bouchard said that Couche-Tard’s top management team recently traveled to Japan and attempted to meet with Seven & i while there, though it didn’t end up working out. He told Bloomberg that ACT wants to not only gain a better understanding of the Japanese culture, but also introduce themselves and understand local concerns about the deal.
This takeover attempt is the third time in two decades that ACT has tried to enter a deal with Seven & i, Bloomberg reported.
A spokesperson from Seven & i said that it will keep its discussions with Couche-Tard private. “We will continue to respond sincerely to discussions that fully recognize the intrinsic stand-alone value of our business and also address our regulatory concerns,” the spokesperson told Bloomberg.
Alex Miller, CEO of ACT, emphasized in his interview with Bloomberg that the company has no plans to “tear up one of the country’s most beloved brands.” In explanation, Bouchard noted that many 7-Eleven locations in the United States don’t sell gasoline, so they don’t directly compete with Circle K stores (owned by ACT) that do sell fuel.
“… We take the best practices from the stores we acquire, or we combine, and we take our best practices together,” Bouchard said. “We’ll keep the people that run this company here, and they will hopefully share our culture, and we will share their culture, and we will be just strong.” Bouchard also noted that no Canadian executive will be sent to Japan to take over local operations.
Seven & i is currently in the process of overhauling its operations by splitting the company in two, Bloomberg reported: “One business focused on 7-Eleven, convenience stores and gasoline stations, while the other will be a collection of 31 less profitable retail operations that might bring in strategic partners and eventually be listed separately.”
In the United States, 7-Eleven convenience stores are shifting their approach to what they provide on shelves and in self-service areas, with a focus on foodservice.
“Food recently overtook cigarettes as the largest category at 7-Eleven Inc.,” 7-Eleven president and CEO Joe DePinto said. The company has been investing heavily in its food and beverage modernization program to capitalize on this shift.
In an October 11 earnings call, 7-Eleven announced that it would be closing 400-plus stores this year, roughly 3% of the company’s more than 13,000 locations in the United States and Canada. In an email statement to Today.com, 7-Eleven said, “Aligned with our long-term growth strategy, we continuously review and optimize our portfolio to deliver convenience where, when and how customers need it. As part of this, we made the decision to optimize a number of non-core assets that do not fit into our growth strategy. At the same time, we continue to open stores in areas where customers are looking for more convenience.”