Dive Brief:
- One of Seven & i Holdings’ investors is urging the company — parent of the 7-Eleven convenience store chain — to “respond without delay” to Alimentation Couche-Tard’s latest buyout offer, according to a Wednesday announcement.
- In a letter sent to Seven & i on Tuesday, the investor, Artisan Partners International, emphasized that Seven & i’s corporate value is “best served by positively engaging with ACT on the terms of its proposed acquisition.” Couche-Tard modified its initial offer of $39 billion last week, and Artisan Partners believes the new amount is $18.19 per share — a 22% increase from the original proposal.
- Artisan also criticized Seven & i’s new plan to turn its supermarkets and specialty stores (SST) division into a separate company, saying the move — which is meant to allow Seven & i to prioritize 7-Eleven — has arrived “too little too late.”
Dive Insight:
Seven & i shared last week that it will set up an intermediate holding company, York Holdings, for its SST business group, which it plans to take public “as soon as reasonably practicable.”
In its letter on Tuesday, Artisan, an investment management company that has owned just over 1% of Seven & i’s outstanding shares since 2019, said shareholders pitched this restructuring plan four years ago, but it was shut down by Seven & i’s board of directors at the time. Activist investor ValueAct pushed a similar plan early last year, again to no avail. Artisan believes Seven & i is implementing the plan now to “impede” and “drive away” Couche-Tard’s “bona fide bid.”
Artisan is urging Seven & i’s board of directors to engage with Couche-Tard — parent of Circle K convenience stores — and “negotiate a purchase price that maximizes value for SIH shareholders without delay.”
“The price currently being offered by ACT is clearly superior to the speculative value that could potentially be achieved by implementing the restructuring plan at this late date,” Artisan’s portfolio managers wrote in the letter.
Artisan has also requested Seven & i disclose the names of the directors serving on the “special committee” that is reviewing Couche-Tard’s bid, and that Seven & i President Ryuichi Isaka and Managing Executive Officer Yoshimichi Maruyama step down from the company’s nomination committee to provide greater neutrality and objectivity. It’s also requesting Seven & i provide compensation practices for overseas executives and directors.
