Seven & i shares give up some gains after Couche-Tard bid

TOKYO :Shares of Japan’s Seven & i Holdings fell more than 7 per cent in morning trade on Tuesday, giving up some of their gains from the previous day, when they surged on news of a takeover proposal from Canada’s Alimentation Couche-Tard.
While the value of the offer has not been disclosed, it would make the 7-Eleven owner the largest-ever Japanese target of a foreign buyout. Couche-Tard owns the Circle-K chain of convenience stores.
Seven & i said it has set up a committee composed only of independent directors to review Couche-Tard’s proposal which includes buying all of the company’s outstanding shares.
The Canadian company confirmed a “friendly proposal” was sent to Seven & i, adding it was focused on reaching a mutually agreeable transaction.
Jefferies said in its research note that Seven & i’s decision to set up an independent committee was positive. But it added that “hurdles remain on the scale of the transaction and antitrust issues”.
By late morning, Seven & i shares were down 7.3 per cent, after losing more than 12 per cent shortly after the open, and making them the biggest percentage loser on the Nikkei.
On Monday, the news of the deal sent Seven’s shares surging by almost 23 per cent in Tokyo, valuing the retailer at around 5.6 trillion yen ($38 billion).
Couche-Tard, which operates Circle-K convenience stores, is valued at roughly $58 billion.
($1 = 146.2800 yen)