In response to the confidential, non-binding acquisition proposal from Alimentation Couche-Tard, Seven & i Holdings sent a letter to the company officially denying the $38 billion acquisition bid.
In the letter, Stephen Dacus, the chair of the special committee formed to review the proposal and chairman of Seven & i's board, wrote:
“I want to emphasize that the Seven & i board is single-mindedly focused on delivering value for Seven & i shareholders and other stakeholders. We are open to sincerely consider any proposal that is in the best interests of Seven & i shareholders and other stakeholders; however, we will resist any proposal that deprives our shareholders of the company's intrinsic value or that fails to specifically address very real regulatory concerns.
After a thorough review and discussion of your proposal, the Seven & i board has unanimously concluded, based on the unanimous recommendation of the special committee, that the proposal is not in the best interest of Seven & i shareholders and other stakeholders. We are open to engaging in sincere discussions should you put forth a proposal that fully recognizes our standalone intrinsic value and addresses our concerns regarding certainty of closing in the current regulatory environment. However, we do not believe, for several critical reasons, that the proposal you have put forward provides a basis for us to engage in substantive discussions regarding a potential transaction.”
The first reason Dacus gave for turning down the proposal was that the committee felt the proposal “grossly undervalues our standalone path and the additional actionable avenues we see to realize and unlock shareholder value in the near-to medium-term.”
Dacus also noted that the special committee felt the proposal “does not adequately acknowledge the multiple and significant challenges such a transaction would face from U.S. competition law enforcement agencies in the current regulatory environment and provides no certainty to closing.”
In closing, Dacus said that he is available to answer any questions Alimentation Couche-Tard may have.