(Bloomberg) -- Seven & i Holdings Co. shareholder Oasis Management is “disappointed” that the Japanese retailer rejected Alimentation Couche-Tard Inc.’s acquisition proposal, according to the founder of the activist investment firm.
“Couche-Tard has put forward a very serious proposal to the company and I am a little bit disappointed with the company’s reaction,” Seth Fischer, chief investment officer at Oasis, said in a Bloomberg Television interview in Tokyo on Thursday.
Oasis has been a shareholder of Seven & i for “a very long time,” Fischer said. He has “thoughts” on the issue but will prefer to share them with the Japanese company privately first, he said.
Couche-Tard this week told Seven & i that it wants to work together to agree on a “friendly” takeover, after the Japanese retailer pushed back on the initial proposal. Fischer said that Couche-Tard also appreciated the national security concerns and the important role that convenience stores play in Japan.
“Now the ball is back in Seven & i’s court to respond,” Fischer said.
The Canadian company offered to buy the operator of 7-Eleven shops for about $39 billion, in what would be the biggest foreign takeover of a Japanese firm. Seven & i rejected the price as too low and said the deal was fraught with regulatory risk.
Couche-Tard has said it’s willing to work with Seven & i on divesting an appropriate number of stores, Fischer said. There would be plenty of buyers, he said.
“Convenience stores in Japan are important in national emergencies,” Fischer said, adding that most 7-Elevens are within 500 meters of other stores. “Maybe that means some of those stores should be sold to a domestic owner” in the event of any merger.
The Oasis CIO said there is a lot of pent-up demand for mergers and acquisitions across many industries in Japan after the government’s corporate governance reforms. “The Japan M&A boom is extraordinarily interesting.”
--With assistance from Shery Ahn, Haidi Lun and Adrian Wong.
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