Last week, the Seven & i Holdings board of directors sent a response letter to Alimentation Couche-Tard (ACT) rejecting Couche-Tard’s acquisition proposal, but said it was open to further dialogue. On Sunday, Couche-Tard responded that it “has deep respect for Seven & i and the business it has built in Japan and around the world, including its operating model, franchisee network and brand. We continue to have strong conviction that a combination with Seven & i has clear strategic and financial benefits for both companies' customers, employees, franchisees and shareholders.”

In the letter, Couche-Tard wrote: “We remain highly focused on consummating a transaction with Seven & i that is in the best interests of all constituencies.”

Notable statements from the Couche-Tard letter include:

• “Given the mutual benefits of a combination, we are disappointed in Seven & i's refusal to engage in friendly discussions. We are highly confident that collaborative discussions would lead to our ability to find increased value for Seven & i shareholders.”
• “Couche-Tard has a successful history and track record of acquisitions and working with U.S. and other regulators, in full compliance with applicable processes and requirements. The U.S. convenience store market is highly fragmented, with over 150,000 stores nationally. Both Couche-Tard’s and Seven & i’s stores operate in the U.S. in competition with a wide array of brick-and-mortar and online food and merchandise providers. Additionally, Seven & i and Couche-Tard largely operate in complementary markets across the U.S.”
• “Couche-Tard has been an extraordinary steward of capital, having driven strong operating performance and successfully integrating a large number of acquisitions. Couche-Tard has generated total shareholder return of over 450% in the last 10 years, more than nine times greater than Seven & i over the same period.”

This morning, Seven & i Holdings offered a short response:

"As our board has previously discussed and stated, we do not believe that the proposal ACT put forward provides a basis for us to engage in substantive discussions regarding a potential transaction. This is precisely why we have not asked our advisors to engage in further discussions or signed an NDA.”

"We remain open to engaging in sincere discussions should ACT put forth a proposal that fully recognizes Seven & i's standalone intrinsic value and addresses the Special Committee's very real regulatory concerns. Unless and until ACT does so, Seven & i will focus on executing its business and pursuing the actionable avenues we see to realize and unlock shareholder value in the near- to medium-term."