What: Seven & I Holdings faces a three-way ownership battle as its founding Ito family proposes a USD 51.7 billion privatisation plan, competing with Couche-Tard's USD 47 billion takeover bid, while management advocates for their internal growth strategy.

Why it is important: The competing bids, particularly the Ito family's unprecedented USD 51.7 billion privatisation plan, demonstrate the significant premium investors are willing to pay for global retail networks with strong market positions, despite industry challenges.

Seven & I Holdings, the operator of over 80,000 7-Eleven convenience stores worldwide, finds itself at the centre of an intense ownership struggle that has sent its shares soaring by 11% in early Tokyo trading. The founding Ito family's ambitious plan to take the company private within the current financial year involves raising more than USD 51.7 billion through a special purpose company, with ongoing discussions with Japan's three largest lenders and major US financial institutions. This move comes in direct competition with Canada's Alimentation Couche-Tard, which recently increased its takeover offer to USD 47 billion, potentially marking the largest-ever foreign acquisition of a Japanese company. The situation is further complicated by the company's management team, who maintain that their internal growth strategy can enhance shareholder value. Seven & I has officially stated that no decisions have been made regarding any of the proposed deals, while emphasising that they were not the source of the media reports about the Ito family's bid.

IADS Notes: The Seven & I Holdings situation mirrors several significant trends observed in global retail throughout 2024. In September 2024, Nordstrom's USD 3.8 billion privatisation bid by its founding family demonstrated similar dynamics to the Ito family's current approach with Seven & I, highlighting how founding families are increasingly seeking to regain control amid market pressures. The valuation dynamics echo January 2024's Macy's case, where a USD 5.8 billion offer was rejected due to undervaluation concerns, particularly regarding real estate assets. This is especially relevant given Seven & I's extensive global network of over 80,000 stores. The competitive aspect is further illustrated by Couche-Tard's USD 47 billion bid, reflecting July 2024's Saks-Neiman Marcus merger (USD 2.65 billion), where industry consolidation was driven by the need to compete more effectively in an evolving retail landscape.

Seven & I shares soar as founder family reportedly speeds buyout plan