Japan invoking ‘economic security’ in 7-Eleven takeover bid

Japan invoking ‘economic security’ in 7-Eleven takeover bid | Daily Tribune

TOKYO (AFP) — Japan will look at the “economic security” aspects of any foreign acquisition of 7-Eleven, a government minister said as Canada’s Couche-Tard pursues a takeover of the world’s largest convenience chain.

Alimentation Couche-Tard, which owns the Circle K brand, wants to buy the store owner’s parent Seven & i but the Japanese firm last year rejected an initial offer worth nearly $40 billion from Couche-Tard.

That led the Canadian company to make a revised bid reportedly 20 percent higher.

“Economic security is a new area... but, for example, I think the acquisition of 7-Eleven is majorly related,” Ryosei Akazawa, Japan’s minister for economic revitalization, said Wednesday.

Akazawa highlighted the role Japan’s convenience stores can play in times of crisis, such as after major earthquakes and other disasters, particularly in remote regions.

“If, for example, 7-Eleven becomes completely owned with foreign capital, to pursue profitability as its first priority, would it really offer full cooperation when a disaster occurs?” he asked reporters.

His comments came after United States (US) President Joe Biden on Friday blocked Nippon Steel’s $14.9 billion takeover of US Steel, citing national security concerns.

The move drew harsh criticism from the Japanese government and businesses, which in 2023 invested almost $800 billion into the US.

In September, the Japanese finance ministry designated Seven & i as a “core” industry in terms of national security.

Other entities rated the same in Japan include manufacturers in the nuclear, rare earths, and chip industries, as well as cybersecurity and infrastructure operators.

Seven & i, however, said at the time that the rating “has nothing to do with the takeover offer” from Couche-Tard.

Seven & i said in November that it was studying a counter-offer from the company’s founding family reportedly worth eight trillion yen ($50 billion).

Japanese media quoted Couche-Tard executives as saying they would not sweeten the bid again, or launch a hostile offer.

The 7-Eleven franchise began in the US, but it has been wholly owned by Seven & i since 2005 and has 85,000 stores worldwide.