INTERNATIONAL NEWS: Lawson Calls Off Acquisition of am/pm Japan
TOKYO -- Lawson Inc., Japan's second-largest convenience store chain, changed its plan to buy smaller rival am/pm Japan Co. after a dispute over brand names, thus ending a bid to consolidate the overcrowded sector, according to a Reuters report.
The deal would have helped Lawson catch up in store numbers with No.1 Seven-Eleven, a unit of Seven & I Holdings as Japan's convenience store chains fight for dominance in a saturated market with over 40,000 small stores spread around Japan, the report stated.
The $149 million deal fell apart because the U.S. owner of the am/pm brand, am/pm International Inc. demanded that 700 stores in the combined group retain that name, according to a company source who spoke anonymously as he was not authorized to speak on the matter, according to Reuters.
"We really wanted to complete this project. It is extremely regrettable that we were not able to reach a final agreement," said Lawson spokesman Shin Ichikawa.
Analysts say the convenience store industry in Japan has to come up with a new strategy given weak growth prospects.
Lawson agreed in February to buy am/pm Japan, owned by Japanese retailing group Rex Holdings Co., in a deal that would have added about 1,100 stores to Lawson's 8,600, boosting its presence in Tokyo.
Ichikawa confirmed his company could not reach agreement over the brand names but would not give details, according to the Reuters report. He said his company's policy was to let its store franchisees decide which of the brands to use.
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The deal would have helped Lawson catch up in store numbers with No.1 Seven-Eleven, a unit of Seven & I Holdings as Japan's convenience store chains fight for dominance in a saturated market with over 40,000 small stores spread around Japan, the report stated.
The $149 million deal fell apart because the U.S. owner of the am/pm brand, am/pm International Inc. demanded that 700 stores in the combined group retain that name, according to a company source who spoke anonymously as he was not authorized to speak on the matter, according to Reuters.
"We really wanted to complete this project. It is extremely regrettable that we were not able to reach a final agreement," said Lawson spokesman Shin Ichikawa.
Analysts say the convenience store industry in Japan has to come up with a new strategy given weak growth prospects.
Lawson agreed in February to buy am/pm Japan, owned by Japanese retailing group Rex Holdings Co., in a deal that would have added about 1,100 stores to Lawson's 8,600, boosting its presence in Tokyo.
Ichikawa confirmed his company could not reach agreement over the brand names but would not give details, according to the Reuters report. He said his company's policy was to let its store franchisees decide which of the brands to use.
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