TOKYO (Reuters) -Shares of Seven & i tumbled as much as 12% on Tuesday, following a report the 7-Eleven owner plans to reject a $47 billion takeover offer from Canada’s Alimentation Couche-Tard, although the Japanese company said it was still considering the offer.
The shares finished down 7% at 2,044 yen in Tokyo having earlier declined as much as 12%, touching their lowest in a little more than six months.
The Yomiuri newspaper reported on Tuesday that Seven & i planned to reject the takeover offer from Circle-K owner Couche-Tard and instead seek to enhance corporate value on its own.
However, in a statement, a Seven & i spokesperson said it “remains committed to exploring all opportunities to unlock value for shareholders and continues to assess a full range of strategic alternatives, including the proposal” from Couche-Tard.
It said its special committee is “engaging constructively” with Couche-Tard.
One shareholder in Seven & i said the retailer’s board should be more actively working with Couche-Tard.
“We are disappointed and surprised with the board’s lack of engagement,” said Manoj Jain, co-founder and Co-CIO of Hong Kong-based Maso Capital, which owns Seven & i shares. “Given the price offered, it’s clear that the board should engage.”
The Canadian retailer has offered $18.19 a share for Seven & i, which represents a premium of almost one third from the current share price, based on Thursday’s yen exchange rate.
If Seven & i pursues a go-it-alone strategy, “it would need to convince the market it can raise corporate value” above the offer price, Jefferies analyst Shunsuke Kuriyama wrote in a note to clients.
Seven & i is finalising a plan for CEO Ryuichi Isaka to step down with his replacement almost certain to be director Stephen Dacus, Reuters has reported.
Dacus heads a special committee to evaluate the takeover bid from Couche-Tard and a take-private deal from Seven & i’s founding family that recently collapsed.
(Reporting by Sam Nussey, Rocky Swift and Kane Wu; Editing by Sandra Maler, David Dolan, Christopher Cushing and Louise Heavens)
