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Market Chatter: 7-Eleven Owner Considers Going Private in Japan's Biggest $58 Billion Buyout
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Market Chatter: 7-Eleven Owner Considers Going Private in Japan's Biggest $58 Billion Buyout
Nov 13, 2024 11:17 AM

08:17 AM EST, 11/13/2024 (MT Newswires) -- Seven & i Holdings Co. is considering a management buyout to take itself private with funding from banks, Itochu Corp. and the founding Ito family in a transaction that could be worth around 9 trillion yen (or US$58 billion), people with knowledge of the matter said, Bloomberg reported overnight Tuesday.

Any deal could be presented as an option for shareholders in the event that Alimentation Couche-Tard Inc. ( ANCTF ) becomes more aggressive with its pursuit of Seven & i and makes a tender offer, the people said, asking not to be identified because the negotiations haven't been made public. Seven & i confirmed the family's non-binding proposal without giving specifics, including a price, the report noted.

Seven & i shares surged as much as 17%, their biggest intraday gain since Aug. 19. Itochu's stock fell as much as 3.4%.

Under the management buyout being discussed, which would be the largest-ever in Japan, trading house Itochu, the founding family and existing investors would contribute 3 trillion yen in cash and equity, the people said. Japan's top megabanks -- Sumitomo Mitsui Financial Group Inc., Mitsubishi UFJ Financial Group Inc. and Mizuho Financial Group Inc. -- would put up 6 trillion yen in financing, the people added.

Bloomberg said such an arrangement would be a "remarkable unified response" to Couche-Tard's takeover approach, the biggest ever foreign attempt to buy a Japanese target. With the participation of Itochu -- Seven & I's top competitor in the domestic convenience store business -- it would reflect the coordinated resistance of corporate Japan to foreign control of one of its most famous companies.

Talks are ongoing and the deal could be difficult given its size, the people said. There's a chance that the management buyout may not proceed if Couche-Tard rescinds its proposal.

Representatives for Sumitomo Mitsui, Mitsubishi and Mizuho declined to comment on any specific transactions. A spokesperson for Itochu declined to comment, saying nothing has been decided.

(Market Chatter news is derived from conversations with market professionals globally, and/or from other media sources. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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