Couche-Tard Executives Ramp Up Pursuit of 7-Eleven's Parent Company
LAVAL, Quebec, & TOKYO — Alimentation Couche-Tard Inc.'s proposed acquisition of Seven & i Holdings Co Ltd., parent company to 7-Eleven Inc., is a better deal than Seven & i's current breakup plan, asserted company leadership this week during a trip to Japan.
The reported $47 billion offer provides certainty and would make it through both the financing process and antitrust regulatory hurdles in the United States, according to the executive team.
"We think [our offer is] more compelling than what was proposed last week, with a great deal more certainty and much less risk," said newly appointed CEO Alex Miller, reported the Financial Times.
[Read more: Seven & i Investor Urges Due Diligence With Acquisition Bid]
Couche-Tard's offer is "cash, versus a hope that [Seven & i] can continue to execute on a plan that's not delivered value over the last years," added former CEO and current special adviser Brian Hannasch during a recent joint interview.
Alain Bouchard, company founder and current chairman, confirmed that Couche-Tard seeks to buy Seven & i in its entirety and plans to keep local Japanese operations intact.
Couche-Tard leadership visited Japan to gain information and discuss the proposal, but did not meet with senior Seven & i leadership, reported Bloomberg.
"We have invited them, we have tried to organize a meeting, but it didn't work, but it will eventually," Bouchard said. "We also want to gain a better understanding of the Japanese culture, but mainly now the Japanese concerns [about the deal.]"
The executive team also sought to "obviously introduce ourselves because people don't know us," he added.
They also have yet to meet with government officials who would be involved in reviewing the deal.
[Read more: Couche-Tard: The Ultimate Industry Consolidator]
Bouchard stressed the importance of maintaining the culture and best practices of Seven & i's operations in Japan.
"We don't move people around. We don't change the model. We adapt. 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."
Flipe Da Silva, chief financial officer at Couche-Tard, stated that financing the deal would not be a problem and that it has already begun talks with Japanese financial institutions and other partners that could help fund the deal while maintaining the company's investment-grade credit rating.
Miller also expressed confidence that the deal can overcome regulatory hurdles, not that many 7-Eleven convenience stores in the United States do not sell gasoline and therefore are not direct competitors to Circle K stores with fuel pumps.
Seven & i previously stated it plans to keep deal negotiations confidential and did not comment on Couche-Tard leadership's visit.
7-Eleven Inc. is No. 1 on the 2024 Convenience Store News Top 100 report. Alimentation Couche-Tard is the No. 2 retailer on the ranking.