Seven & i Holdings' Independent Directors to Review All Options

TOKYO — Shortly after a second investor joined the call for Seven & i Holdings to explore a spinoff of the 7-Eleven Inc. convenience store chain, the company's eight directors from outside Seven & i unanimously confirmed that all options are on the table, pursuant to an updated medium-term management plan announced on March 9.

"As the most important point, the strategy committee — consisting solely of the outside directors — has been created not only to advance the company's strategy, but also to guide its successful execution and assess strategic options […] and recommend actions and/or changes," the directors wrote in a joint letter dated April 6. "In that light, along with our fellow board members, we are committed to rigorously assessing opportunities to create value for all stakeholders and adjusting our mid- and long-term strategies accordingly."

The addition of six outsiders to Seven & i's board of directors was the result of "sincere and thoughtful" shareholder feedback and discussions, including with ValueAct, the hedge fund that has long advocated for a spinoff.

The full board of directors unanimously voted in favor of the March 9 plan and the creation of the strategy committee. The plan has a strong focus on the company's successful c-store business and is aligned on a clear vision for growth by recognition the critical contributions that food-related businesses make in a market that increasingly depends on private label and ready-to-eat meals, according to the letter.

The growth strategy draws on Seven & i's competitive strength in food between the c-store and superstore business to drive global growth across formats.

"The board will continue to review optimal group structure and strategic alternatives (IPO, spinoff, etc.) comprehensively and objectively through the strategy committee process," the outside directors wrote. "The company has made it clear its willingness to divest noncore operations, such as its department stores."

The letter called out multiple steps Seven & i has undertaken to enhance governance and accelerate growth, such 7-Eleven's acquisition of Speedway LLC and Sunoco in 2021 and 2018, respectively, as well as the investment in the company's Vietnam business to expand its global footprint. It also announced the realignment of the company's financial services.

"The entire board, along with the outside directors, is committed to maximizing corporate value through the execution of the company strategy, including driving growth in the convenience store business and restructuring the superstore business," the letter concluded. "Moreover, the strategy committee of outside directors will provide active oversight and assess strategic options for the optimal course through which to create value for all stakeholders."

The full letter is available here.

Irving, Texas-based 7-Eleven operates, franchises and/or licenses more than 13,000 stores in the United States and Canada. In addition to 7-Eleven stores, the company operates and franchises Speedway, Stripes, Laredo Taco Co., and Raise the Roost Chicken and Biscuits locations.