Alimentation Couche-Tard Inc. (“Couche-Tard” or the “Corporation”) (TSX: ATD) announced today that it has officially withdrawn its proposal to acquire Seven & i Holdings Co., Ltd. (“Seven & i”), citing a lack of meaningful engagement from Seven & i. The Corporation issued the following letter to the Board of Directors:
July 16, 2025
Board of Directors
Seven & i Holdings Co., Ltd.
8-8, Nibancho, Chiyoda-ku
Tokyo 102-8452, Japan
Members of the Board of Directors:
We remain confident that a combination of Seven & i Holdings (“7&i”) and Alimentation Couche-Tard (“ACT”) would have created a global leader in convenience retail, uniquely positioned to deliver enhanced value to all stakeholders, strengthen the 7-Eleven brand, and generate significant long-term returns for our respective shareholders.
Earlier this year, we submitted a proposal to acquire 7&i at ¥2,600 per ordinary share in cash—representing a 47.6% premium to your unaffected stock price. We made this offer in good faith, backed by fully secured financing and a clear path to obtaining the necessary regulatory approvals. Throughout this process, we sought to engage constructively and respectfully, including efforts to open a direct dialogue with the Ito family, which regrettably were not reciprocated.
We have consistently demonstrated a willingness to collaborate, including the potential to enhance the economic terms of our offer—provided we were granted access to additional due diligence materials. This was further reinforced by our entry into a non-disclosure agreement with customary standstill provisions following our April 18, 2025 meeting in Tokyo with Hachiuma-san and Yonamine-san. At that time, we believed we were initiating a genuine process aimed at determining whether a transaction could be achieved.
However, since executing the NDA, there has been a striking lack of constructive engagement from 7&i. Despite public statements to the contrary—including comments made during your July 11, 2025 earnings call that the proposal was being “seriously” considered—our efforts to engage meaningfully have been met with delay and obfuscation. The due diligence process has been limited in both scope and substance, with only two tightly controlled management meetings offering minimal insight.
This pattern of behavior raises serious governance concerns and has led us to conclude that there is no genuine intent on your part to explore our proposal in good faith. As a result, and with considerable disappointment, we are formally withdrawing our proposal.
Due Diligence
At our April 18, 2025 meeting in Tokyo, we outlined a focused list of high-priority commercial due diligence items that could support an improved proposal. On May 9, 2025, your advisors opened a data room; however, it contained limited information on SEI and only confirmatory data regarding operations in Japan. We submitted a further streamlined diligence request on May 22, 2025, highlighting the most essential items required for us to proceed.
Despite this, the document we received on June 25, 2025 included no meaningful updates and again referred us back to statutory filings. After 10 weeks of due diligence, we had received just 14 files related to the U.S. business—none of which addressed our key questions.
While we understand the commercial sensitivities involved in transactions of this nature, we have consistently aimed to engage constructively and collaboratively—an approach we have successfully employed in 75 transactions over two decades. Unfortunately, our efforts have not been met with reciprocal cooperation.
Management Meetings
We also agreed there would be meaningful engagement with business leaders across the 7&i organization. While we appreciate that two meetings did occur—one in Dallas and one in Tokyo—the level of engagement fell short. In Dallas, CEO Mr. DePinto was absent, and President Mr. Reynolds participated only after our explicit request for senior leadership involvement. According to your advisor, the session was characterized as a “readout” rather than a substantive dialogue.
Though certain 7-Eleven team members took a constructive tone, the discussions yielded little new insight. In one instance, a 7-Eleven executive attempted to respond thoughtfully to a question on international licensees—an issue with no U.S. regulatory implications—but was interrupted by Mr. Dacus, who made a visible gesture indicating the executive should restrain their comments. Mr. Dacus further asserted that the meeting was a management presentation “not due diligence,” and therefore many questions would not be addressed. As noted, none of those questions have been answered since.
The Tokyo meeting was similarly limited. The session lasted for only half of the scheduled time and followed a tightly controlled script. Although we do not currently operate in Japan, the team declined to engage on even basic questions about the country’s retail industry landscape.
U.S. Regulatory Approval and Process
From the outset, we have acknowledged the importance of regulatory approvals across various jurisdictions. Since our initial proposal on July 25, 2024, we have continued to assert that there is a clear path to securing U.S. regulatory approval.
On December 27, 2024, we submitted a detailed term sheet to 7&i, outlining specific commitments: the divestiture of a defined number of stores, and a robust reverse termination fee structure. This structure would deliver approximately $1.2 billion in value—rising to over $1.4 billion if the FTC required further divestitures and ACT chose not to proceed. These terms were designed to shift substantial regulatory risk from 7&i shareholders to ACT, while strongly incentivizing us to secure necessary approvals.
We also acknowledged your emphasis on identifying credible divestiture buyers. Despite the unconventional nature of doing so before finalizing an agreement, we undertook the process and, on March 31, 2025, received several credible, experienced indications of interest for the divestiture portfolio. However, progress has been hampered due to a lack of cooperation—specifically, the necessary information was not shared with potential buyers. This reluctance undermines the stated goal of addressing regulatory concerns and suggests an absence of constructive intent.
- Following the execution of the NDA, our advisors held an organizational call with you on April 29, 2025, to align on the next steps for advancing the divestiture process. This included defining workstreams for further due diligence, planning for the separation of the divestiture perimeter, and preparing for the upcoming phase of buyer engagement. However, there has been no meaningful progress on these workstreams since that discussion.
- On May 13, 2025, we provided a comprehensive outline of the due diligence materials recommended for potential buyers, and we mutually agreed that certain sensitive information would be walled off to address commercial concerns. Despite this, we have not received any feedback from you or your advisors on the proposed list, nor have we seen any indication that efforts are underway to compile the necessary information for the next stage of the process.
Exploration of Alternative Transaction Structures
As we have consistently communicated, we believe that a full combination of our two companies remains the most direct and effective path to unlocking long-term value for all stakeholders. We remain willing to offer a substantial premium over the undisturbed share price to 7&i shareholders in pursuit of this goal.
Nonetheless, in response to your request to explore alternative transaction structures, we have dedicated significant time and resources to evaluating approaches that could deliver similarly attractive value, without introducing additional closing risks or uncertainty. Our aim has been to identify a structure that maximizes stakeholder benefit while minimizing friction.
As a meaningful step forward, we presented in Dallas our willingness to pursue a structure in which we would acquire 100% of 7&i’s non-Japan business, along with a 40% stake in the Japan-based parent company (“ParentCo”), leaving the remaining 60% of ParentCo in the hands of existing 7&i shareholders. This alternative structure offers comparable value to our prior all-cash proposal and allows 7&i shareholders to retain meaningful upside through ongoing participation in the international business via equity ownership in ACT.
Our detailed, outside-in analysis suggests this approach is not only economically compelling but also executable with limited complexity—specifically, without triggering corporate-level taxation or introducing additional transaction risks.
During our July 1 meeting in Tokyo, you presented a different concept, proposing to contribute SEI into Couche-Tard in exchange for equity in Couche-Tard. While we appreciate the dialogue, we believe that your suggested approach would not deliver the significant shareholder premium embedded in our prior offers and, more importantly, would compromise the operational effectiveness of the combined business.
We remain open to constructive engagement and look forward to continuing discussions that deliver maximum value to your shareholders and ours.
About Alimentation Couche-Tard Inc.
Couche-Tard is a global leader in convenience and mobility, operating in 29 countries and territories, with close to 17,000 stores, of which approximately 13,000 offer road transportation fuel. With its well-known Couche-Tard and Circle K banners, it is one of the largest independent convenience store operators in the United States and it is a leader in the convenience store industry and road transportation fuel retail in Canada, Scandinavia, the Baltics, Belgium, as well as in Ireland. It also has an important presence in Luxembourg, Germany, the Netherlands, Poland, as well as in Hong Kong Special Administrative Region of the People’s Republic of China. Approximately 146,000 people are employed throughout its network.
