TOKYO, Sept 17 (Reuters) - The new classification of

7-Eleven's parent company as "core" to Japanese national

security will not raise hurdles to a potential buyout, Japan's

finance minister said on Tuesday, comments that appeared aimed

at easing investor concerns about the move.

"We can't say the core classification makes a buyout more

difficult," Suzuki told reporters, days after Seven & i Holdings ( SVNDF )

became one of 88 companies added to the government's

list of companies regarded as crucial to national security.

The change prompted speculation among some market

participants that Seven & i ( SVNDF ), which was previously designated as

"non-core" was attempting to better defend itself from a

potential takeover by Canada's Alimentation Couche-Tard ( ANCTF ).

Seven & i ( SVNDF ) this month rejected a $38.5 billion offer from

Circle-K owner Couche-Tard, citing concerns about price.

The potential deal is being closely watched not only for the

implications for the retail industry - where it would create a

globe-spanning convenience store giant - but also for further

clues about the trajectory of Japan's governance reform.

The benchmark Nikkei share average has powered

through a series of record highs this year, a once seemingly

impossible feat, as foreign investors have rallied behind what

they see as meaningful governance change.

Any whiff of protectionism such as blocking of foreign

takeovers on less-than-credible grounds could blunt enthusiasm

for both the stock market and mergers and acquisitions (M&A),

market participants have said.

"In principle Seven & i's ( SVNDF ) reclassification to core-sector

should not change the deal outcome," Jefferies analysts said in

a note on Tuesday. "It's a litmus test for government resolve on

enhancing corporate/shareholder value through a fair M&A

market."

SELF-REPORTED

It was not immediately clear what part of Seven & i's ( SVNDF )

sprawling businesses justified the change. The conglomerate runs

a security business and a bank, both of which are widely seen as

more critical to Japan's security than its vast network of

7-Eleven stores or its Denny's family restaurants.

Finance ministry officials said repeatedly at a Friday

briefing that the national security classifications that appear

in its list are mainly self-reported by companies and not a

government acknowledgement that those in the "core" list are

crucial for national security.

Whether a business categorised as "core" is crucial or

not will be determined during an actual review, they said.

"Japanese companies had long been unattractive targets, so

buyout proposals like this are welcome, especially as Japan is

eager to expand foreign direct investment," one senior

government official told Reuters.

When a company is categorised as core, foreign entities

seeking to buy a stake of 1% or more in the Japanese firm must

in principle file for a national security review with the

Japanese government prior to the purchase.

In cases where control is sought, however, Suzuki said prior

notification for a review is mandatory "regardless of whether

they are categorised as core or non-core."