(Bloomberg) -- Any company that seeks to take over a Japanese business will require prior notification to the government, making it hard to say that Seven & i Holdings Co.’s designation as “core” to national security would make any buyout deal difficult, Finance Minister Shunichi Suzuki said.
Circle K owner Alimentation Couche-Tard Inc., which approached Seven & i last month with a proposal to buy the operator of 7-Eleven shops for $38.7 billion, has been seeking to enter negotiations to buy the company but rebuffed because the indicated price was deemed too low.
Now the question is whether the Canadian retailer will come back with a sweetened proposal or structure for a potential deal, and whether the new designation announced last week will prove to be a hurdle. The category requires any foreign entity to give prior notification of share purchases in a core company of more than 10%.
“Regardless of core designation, any attempt of takeover requires prior notification to the government and we examine each case from the perspective of national security,” Suzuki told reporters. “So we cannot say being designated as ‘core’ companies would make a takeover more difficult.”
7&i Holdings shares fell as much as 3.2% during trading on Tuesday, following the finance ministry’s disclosure late on Friday.
While the filing was made in response to a routine query by the ministry, Seven & i’s efforts to change its status underscore its wariness toward Couche-Tard’s approach, which comes after years of activist investor criticism that its assets are undervalued.
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