Seven & i Holdings Co. is embarking on its biggest-ever overhaul, betting that a bold breakup will help fend off an unsolicited takeover proposal from a smaller rival and make up for a sluggish profit outlook.
Allan Small, senior investment advisor at IA Private Wealth, explains Couche-Tard's bold new offer to 7-Eleven owner for Seven & i.
Seven & i essentially unveiled a plan to split in two: One business would be focused on 7-Eleven, convenience stores and gasoline stations, and the other would be a collection of 31 less profitable retail operations that might bring in strategic partners and eventually be listed separately. The big question is if the move will be enough to win over any investors warming to Couche-Tard’s approach.
Isaka said Seven & i will keep a minority stake in the retail business that will be split off and called York Holdings Co. An investor relations day is being planned for Oct. 24 to provide more details on the initiative. “There wasn’t a story strong enough to convince investors that the company can improve deteriorating performance,” said Ikuo Mitsui, fund manager at Aizawa Securities Co., adding that it would have been better if Seven & i had presented a plan to boost sales, rather focusing mainly on profitability.
Asked about the approach, Isaka said that Seven & i would refrain from speaking about any discussions, on the request of Couche-Tard, and listen to shareholders on any proposals that would lead to greater corporate value. Since Couche-Tard’s approach became public, Seven & i sought, and received, a designation of being a core business essential to national security, a step that was seen as an attempt to make it harder for a foreign entity to take over the company. Even so, Japan’s finance ministry has played down the idea that the designation would make any buyout difficult.
Pacific Rim Bonds Business Top Canada Markets Consumer Goods Retail Consumer Discretionary Consumer Staples Company News Financials Government Industry Japan Energy Oil Top News World Top World
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
UN advisory body makes seven recommendations for governing AIAn artificial-intelligence advisory body at the United Nations on Thursday released its final report proposing seven recommendations to address AI-related...
Read more »
Big Banks Are Split on How Fast the Fed Will Cut Interest RatesWall Street’s biggest banks are divided over how fast and deep the Federal Reserve will cut interest rates over the next year, setting the stage for jittery financial markets until the outlook clears.
Read more »
Altice France Secured Creditor Group Faces Potential Split(Bloomberg) -- A letter sent by the law firm advising Altice France’s secured creditors is putting the group’s unity to the test, raising the prospect of its...
Read more »
Bank of Canada Officials Split on Balance of Inflation RisksSome Bank of Canada officials are increasingly worried about downside risks to inflation as they decide how to set interest rates, while others see them as more balanced.
Read more »
Bank of Canada members split on inflation outlook, minutes showThe Bank of Canada's governing council was split on the outlook for inflation ahead of its Sept 4 decision to cut rates for the third time in a row, minutes ...
Read more »
$80 million Lotto Max jackpot split between two winning ticketsThe record-breaking Lotto Max jackpot worth $80 million was split between two winning tickets — one sold in Ontario and one sold in Quebec, the OLG said.
Read more »