7-elves: Japanese owner ordered US CEO against takeover offer

7-elves: Japanese owner ordered US CEO against takeover offer

The Japanese operator of the 7-eleven chain, Seven & I Holdings, has appointed his first foreign CEO to reform the company and defend itself against a takeover offer of $ 47 billion. This significant decision follows on turbulent six months, which began with the purchase offer of the Canadian operator Alimentation Couch-Sart (act).

new CEO occurs

On Thursday, Seven & I announced a comprehensive restructuring of corporate management and business strategy. The leading external director Stephen Dacus will follow Ryuichi Isaka as CEO on May 27th. In a press conference, Dacus in Japanese and English explained that the conversations with Couch-Dard continued, but there are considerable regulatory hurdles of a merger.

"I don't think our shareholders want to spend two years in the uncertain, only to be rejected by the US courts," continued Dacus.

strategic sales and stock returns

Seven & I operates over 80,000 7-eleven branches in 20 countries and regions worldwide. The company announced that it will sell its supermarket division for 814.7 billion yen ($ 5.50 billion) to Bain Capital and reduce its participation in Seven Bank to less than 40 %. In addition, the retail company plans to buy back shares worth around 2 trillion yen ($ 13.5 billion) by the 2030 financial year and to strive for the list of his North American subsidiary for the second half of 2026.

criticism of corporate management

The investors have criticized the capital allocation of Seven & I for years. In August, the company received the ACT takeover offer, which was later increased to $ 47 billion. In response to this, a group, led by the founding family ITO, also submitted a takeover offer, while the corporate management declared that they want to take an independent way to relax.

DACUS, who worked as a CEO in the past at Walmart and Fast Retailing, explained that he could identify with 7-eleven franchisee because his father himself was one and he worked as a teenager in a shop. The chairman of the supervisory board Stephen Dacus is now moving into a key position and takes over the management of the company.

market analysis and future prospects

After the disclosure of the buyback plan, the shares of Seven & I rose by 6.1 %on Thursday. Lorraine Tan, a regional director at Morningstar, commented on the share return purchases as an attempt to increase the market value and defend itself against Couchen-Sard. "One of the main worries I have is how they finance the dividends and return purchases," said Tan. "It seems as if they will be dependent on loans, but we notice the discussion about listening to your US business."

Some analysts believe that the restructuring plan of Seven & I acts could not stop takeover offer. The announced selling minority shares mainly leave Seven & I back with its retail stores at home and abroad, what exactly is what act wants.

The future of Seven & I

bain plans to bring the supermarket division, known as York Holdings, to take the stock exchange within three years after it has grown through takeovers. With the switch to fresh food products and expansion abroad, Seven & I has a clear sales plan, which is aiming for a decoupling sales to 30 trillion yen by 2030. Dacus confirms that Seven & I is currently working with suppliers to bring Japanese food products to the US branches.

"If we can bring the same quality of the food to our US branches, that would be an important and sustainable source of growth," said Dacus.

If ACT gains control of Seven & I, this would be the largest foreign takeover of a Japanese company. In September, Seven & I was classified as “robust” for Japan's national security, but the Ministry of Finance said that this would not make any hurdles for a takeover.