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7-Eleven Special Committee Remains Neutral to Unsolicited Offer

DALLAS -- 7-Eleven Inc. announced that the special committee of its board of directors has filed its initial solicitation/recommendation statement on Schedule 14D-9 with the Securities and Exchange Commission in connection with its evaluation of the unsolicited tender offer initiated by 7-Eleven Japan Co.

As stated in the Schedule 14D-9, the special committee is unable to take a position with respect to the tender offer and has not yet completed a full and deliberate review and evaluation of the material terms and provisions of the offer with the committee’s legal and financial advisors. The special committee expects to complete its review and evaluation of the offer soon. At that time, they will inform 7-Eleven’s shareholders as to whether the special committee has determined to recommend acceptance or rejection of the tender offer; remain neutral toward the tender offer or state that it is unable to take a position with respect to the tender offer.

The committee requests that the shareholders of 7-Eleven not tender their shares with respect to the tender offer at the current time, and defer making a decision until the special committee has advised shareholders of its position or recommendation. 7-Eleven operates or franchises approximately 5,800 stores in the United States and Canada and licenses approximately 22,700 stores in 17 countries and U.S. territories worldwide.

As previously reported on CSNews Online, Seven-Eleven Japan said it intends to buy outstanding shares of 7-Eleven to help strengthen the U.S. chain’s operations. The $1.02 billion deal would be made through Seven-Eleven Japan's wholly owned subsidiary, IYG Holding Company.

Seven-Eleven Japan currently owns 72.7 percent of the outstanding common stock of the U.S. chain, and intends to offer to acquire the balance of common stock at a price of $32.50 per share in cash, representing a 15 percent premium over the closing price for 7-Eleven's shares on Aug. 31.

The Japanese company said the buyout is necessary to "maintain 7-Eleven's growth and to allow [it] to compete effectively in the increasingly competitive convenience store and retail industry over the long term." SEJ said the U.S. operation must increase its investment in merchandising, store renovation, distribution and logistics, and information systems.

SEJ said its offer provides 7-Eleven's minority investors an opportunity to avoid risks relating to lower short-term growth and profitability that would result from these needed investments; and that taking the chain private will also help to achieve a better-governed group structure.

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