An expert says that Seven & i Holdings Co., the Japanese owner of global convenience store chain 7-Eleven, may be open to a takeover from Alimentation Couche-Tard Inc. if the Quebec-based company revises its offer.
Bloomberg News reported on Thursday that Seven & i plans to tell Couche-Tard that its current offer price is too low and that it remains concerned about the anti-trust and competition implications of what would be the largest-ever foreign takeover of a Japanese company.
Despite the apparent setback for Couche-Tard, managing director of Stifel Canada, Martin Landry, told BNN Bloomberg in a Thursday interview that Seven & i has seemingly left the door open for negotiations to continue.
“I do see this media report, if it becomes true, as a positive development… 7-Eleven is not saying no, it’s saying: ‘Look, if you do revise your offer and increase your price, maybe we can discuss,’” he said.
“So, for me, I think it signals a little bit of an openness from the management team of Seven & i. It could suggest that there’s potential for discussions going on.”
Landry added that those negotiations are likely to remain tense, as 7-Eleven is deeply rooted in Japanese culture, and the country’s government, which has the power to kill a takeover deal, is monitoring the situation closely.
“7-Eleven stores in Japan are a very popular part of the culture… they’re well-maintained, they’re well-located, so no wonder why Couche-Tard is interested in that asset,” he said.
Landry said despite the anti-trust concerns, Seven & i stock is up more than 20 per cent since news of Couche-Tard’s takeover offer broke last month, indicating that investors believe a deal could be imminent.
“To me, that’s the best read in this situation,” he said.
“You’ve got investors on the ground there that have bid up the stock in anticipation that maybe something happens.”
With files from Bloomberg News