Japan’s Itochu Corporation will not be participating in the Seven & i Holdings buyout proposed by the founding Ito family, as reported by Nikkei. This decision comes after Seven & i’s founders initiated plans to privatize the retail giant, which could potentially be worth around $58 billion.
Amid this backdrop, the Canadian conglomerate Alimentation Couche-Tard had previously tabled an offer for the company, setting the stage for the current private takeover ambitions. Initially, Itochu toyed with the idea of a significant investment worth 1 trillion yen (approximately $6.69 billion) but deemed the benefits unmatched with its current food and beverage portfolio. This decision was also influenced by its existing stake in FamilyMart, a direct competitor to Seven & i.
Seven & i’s CEO, Ryuichi Isaka, could find himself compelled to reconsider Couche-Tard’s proposal valued at about $47 billion.
On the financial backing front, major Japanese financial institutions such as Sumitomo Mitsui, Mitsubishi UFJ, and Mizuho were expected to support the transaction. Meanwhile, Citigroup and Bank of America have considered involvement by refinancing Seven & i’s U.S. obligations.
Thailand’s Charoen Pokphand (CP) Group was linked to the Seven & i management buyout as well. It was reported late January that Japan’s Seven & i founding family approached CP Group to consider the deal.
CP All Public Company Limited (SET: CPALL), a subsidiary of CP Group, operates more than 15,000 7-Eleven stores in Thailand. Its share price plunged as much as 16% in total after several days following the report due to investment concerns. However, the price is now picking up to only 5% below the level it stood at before the report.
Furthermore, local sources recently indicated that Bain Capital has emerged as a preferred partner for acquiring portions of Seven & i’s non-core holdings. Offering over 700 billion yen ($4.7 billion) for York Holdings, Bain’s offer exemplifies the shifting competitive landscape in Japan’s retail sector.
