The U.S. Federal Trade Commission has notified Seven & i Holdings Co. Ltd. of its intention to investigate a potential takeover of the Tokyo-based parent of the 7-Eleven convenience-store chain by Canadian c-store company Alimentation Couche-Tard Inc. over antitrust concerns, a source familiar with the matter told Reuters on Tuesday.
The FTC sent Seven & i the notice of its intent after the offer was made public, the source told the news agency, requesting anonymity because they were not authorized to speak publicly about the matter. It reached out to the company and asked it to preserve all documents that may be relevant to a review of a potential acquisition by Couche-Tard, the sources said.
The FTC has yet to make a public announcement about the matter. When contact by CSP, the agency said, “As a general matter, the FTC does not comment on pending mergers or acquisitions.” Seven & i also did not immediately respond to a CSP request for comment.
When the FTC receives notice of proposed mergers under the Hart-Scott-Rodino (HSR) Amendments to the Clayton Act, its lawyers, along with economists from the agency’s Bureau of Economics, investigate market dynamics to determine if the proposed merger will harm consumers. When necessary, the FTC may take formal legal action to stop a merger, either in federal court or before an FTC administrative law judge.
Couche-Tard, parent of the Circle K c-store brand, on Aug. 19 submitted a “friendly,” nonbinding proposal to Seven & i, parent of the 7-Eleven c-store brand, to acquire all outstanding shares of the company. Seven & i confirmed that it received the confidential, nonbinding and preliminary acquisition proposal, and the Seven & i board formed a special committee, comprised solely of independent outside directors and led by Stephen Hayes Dacus as chairperson, to review the proposal.
Dacus, in a letter on behalf of the board, rejected the proposal offering $14.86 per share in cash, saying it “grossly undervalues” Seven & i as well as the “opportunities to unlock” its intrinsic value.
“We are open to sincerely consider any proposal that is in the best interests of 7&i shareholders and other stakeholders; however, we will resist any proposal that … fails to specifically address very real regulatory concerns,” It emphasized that Seven & i is “open to engaging in sincere discussions.”
In its Sept. 8 response to Seven & i’s letter, Couche-Tard said, “Given the mutual benefits of a combination, we are disappointed in 7&i’s refusal to engage in friendly discussions. ... In addition to enabling Couche-Tard to find more value, engagement will also enable us to refine our regulatory proposal to sufficiently address deal certainty.”
It added, “We stand by prepared to enter into collaborative and friendly discussions with 7&i to focus on finding greater value for 7&i and its shareholders, providing regulatory certainty and ensuring that the combined entity continues to be the leader and provider of premier offerings in the markets we both serve.”
Seven & i is a global operator of convenience stores, superstores, supermarkets, specialty stores, foodservices, financial services and IT services. 7–Eleven International LLC franchises or licenses more than 44,000 stores in 19 countries and regions, The brand also operates corporate or franchise stores in the United States, Canada, Mexico and Japan. Globally, the 7-Eleven trademark is represented in approximately 83,000 stores.
Irving, Texas-based 7-Eleven Inc. operates, franchises or licenses more than 83,000 convenience stores in 19 countries and regions, including more than 13,000 7-Eleven convenience stores in the United States.
- 7-Eleven is No. 1 on CSP’s 2024 Top 202 ranking of U.S. c-store chains by store count. Alimentation Couche-Tard is No. 2.
Laval, Quebec-based Couche-Tard operates in 31 countries and territories, with more than 16,700 stores. Its network includes more than 7,100 stores in the United States under the Circle K and Holiday Stationstores banners, and approximately 2,100 in Canada under the Circle K and Couche-Tard banners.
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