7-Eleven parent moves to avoid a corporate takeover

Big Slurpee is fighting to keep its hold on the frozen drink. 7-Eleven’s parent company, Japan’s Seven & i Holdings, yesterday announced a series of moves designed to keep both investor pressure and a $47 billion takeover offer from the Canada-based operator of the Circle K convenience store chain at bay:

• Former Walmart exec Stephen Dacus will take over as CEO, becoming the first American to hold the role.
• The company’s US unit, with 13,000+ 7-Eleven locations, will IPO by the second half of next year, a move designed to boost Seven & i’s overall value.
• A $13 billion share buyback will be enacted over the next five years.

Why fight the bid?

At the moment, Seven & i’s most profitable segment is its ~22,000 Japanese 7-Eleven stores.

And these stores, a point of national pride and deemed critical to national security by Japan’s government, look a little different than their American counterparts – namely, clean and offering a wide array of unpackaged food that doesn’t look like it’s been sitting under a heat lamp for days (one proofpoint: the stores were beloved by celebrity chef Anthony Bourdain).

😬 The big concern: Customers in Japan fear the chain’s service and quality would worsen under Western ownership. Previous efforts to fend off the takeover include a $50 billion bid from a son of Seven & i’s founder to take the company private, but it fell apart late last month.