FTC Reportedly To Probe 7-Eleven Owner’s Potential Takeover by Couche-Tard

The US Federal Trade Commission (FTC) has reportedly informed Japan’s Seven & i Holdings of its intention to investigate a potential acquisition of the 7-Eleven convenience store chain by Canadian company Alimentation Couche-Tard, due to antitrust concerns, according to a Reuters report.

Alimentation Couche-Tard made a $38.5 billion offer to acquire Seven & i, but the Japanese retail giant rejected the bid, citing concerns over U.S. antitrust regulations. Per Reuters, the FTC notified Seven & i of its plan to investigate the deal following the public announcement of the offer on August 19. The information comes from a source familiar with the situation who requested anonymity, as they were not authorized to speak publicly.

If this deal proceeds, it would become the largest acquisition of a Japanese company by a foreign buyer in history. However, in addition to potential U.S. regulatory hurdles, the proposed takeover is expected to face scrutiny in Japan as well, with two mergers and acquisitions lawyers noting that the transaction could come under review under the country’s Foreign Exchange and Foreign Trade Act.

Seven & i operates more than 12,500 7-Eleven stores across the U.S., while Couche-Tard owns over 7,000 convenience stores, according to data from food consultancy firm Technomic. Combined, the two companies would control nearly 20,000 stores across the U.S., which would place them far ahead of their closest competitor, Casey’s. Together, they would also employ over 200,000 people.

The prospect of such a large consolidation in the U.S. market has sparked concerns from antitrust regulators. The Biden administration has been particularly proactive in challenging mergers and acquisitions, both through legal challenges and in the court of public opinion. As a result, several companies have reconsidered or abandoned major deals in recent years out of fear they would be blocked by regulators.

Source: Reuters