Seven & I Holdings

New offer from 7-Eleven owner could derail Couche-Tard and include US IPO

Another hat could soon be thrown into the bidding cupboard. The Japanese Ito family, the founders of the 7-Eleven chain in the country, is set to launch a management buyout of Seven & i Holdings $3382 (-2,25%) worth 9 trillion yen (60 billion dollars). The offer would be against
an offer of 7.1 trillion yen (47 billion dollars) from Canadian company Alimentation Couche-Tard
$ATD (+1,09%) a multinational convenience store operator that owns rival Circle K in the US.

Background:

Seven & I
has long been under pressure from activist shareholders and rejected an initial offer from Couche-Tard in September on the grounds that the company undervalued its business and failed to address regulatory concerns. A higher offer was eventually made, but new efforts are being made to prevent the brand from falling into foreign hands. An offer from the founding Ito family would prevent the largest takeover in Japan and lead to Seven & I being split into three independent companies.

The first would raise more than one trillion yen (6.6 billion dollars) in cash via the IPO of the North American 7-Eleven businesses (as well as gas station subsidiaries Speedway and Sunoco). These businesses generated sales of 70.3 billion dollars in the last fiscal year, demonstrating the strength and reach of the company. Another planned unit would include 7-Eleven convenience stores in Japan, while the latest division was announced back in October and would be created by spinning off Seven & I's non-core Japanese businesses such as supermarkets, specialty stores and retail outlets.

As every Sunday, the most important news from the past week, as well as the most important dates for the coming week, also as a video:

https://youtube.com/shorts/2ARxb6SwdI4?si=SG4oZ22bYpPc-M3W

Monday:

The Canadian group $ATD Couche-Tarde probably wants to take over the 7-Eleven parent company $3382 (-2,25%) Seven & I Holding. This increases the likelihood of seeing the cult stores in Germany soon. The deal would be the largest takeover of a Japanese company by a foreign company. Couche-Tarde would probably have to put at least USD 38 billion on the table, which is the current valuation of the holding company.

https://www.handelsblatt.com/unternehmen/handel-konsumgueter/convenience-uebernahme-aktie-von-7-eleven-betreiber-steigt-um-23-prozent/100061127.html

Tuesday:

Producer prices in Germany continue to fall, good news as producer prices are a leading indicator for inflation. Compared to the previous year, producer prices fell by 0.8%. This is mainly due to the continued fall in energy prices. Natural gas, for example, was 12.3 % cheaper than in 2023.

https://www.ariva.de/news/deutschland-rckgang-der-erzeugerpreise-schwcht-sich-11345756

Wednesday:

The FOMC minutes already provide the first indication of a rate cut in the US. According to the minutes, the overwhelming majority was probably in favor of starting the rate cut at the beginning of September.

https://www.handelsblatt.com/finanzen/geldpolitik/us-notenbank-fed-protokolle-us-waehrungshueter-deuten-moegliche-zinswende-an/100061918.html

Thursday:

The data from the Purchasing Managers' Index is surprisingly poor. The index for industry and service providers fell to 48.5 points. All values below 50 indicate an economic downturn. Economists had expected a minimal increase to 49.2 points. The barometer for industry fell to 42.1 points. Industry is thus continuing to shrink. The value for service providers was 51.4 points. However, this value also fell.

https://www.handelsblatt.com/politik/deutschland/einkaufsmanagerindex-deutsche-wirtschaft-beschleunigt-talfahrt/100062059.html

Friday:

After the BoJ surprisingly raised interest rates, the central bank of Japan 🇯🇵 could be prepared to raise interest rates further. At least that is what Chairman Kazuo Ueda has said.

https://www.handelsblatt.com/finanzen/geldpolitik/bank-of-japan-boj-chef-ueda-signalisiert-bereitschaft-zu-zinserhoehungen/100062288.html

$BMW (+0,87%) BMW can now also sell more e-vehicles than $TSLA (-4,58%) Tesla in Europe. In July, BMW sold 14,869 e-vehicles in Europe. Tesla only sold 14,561.

https://www.handelsblatt.com/mobilitaet/elektromobilitaet/autobauer-bmw-ueberholt-tesla-bei-verkauften-e-autos-in-europa/100062187.html

Most important dates in the coming week:

Thursday: 14:00 Inflation data (DE)

Thursday: 14:30 GDP figures (USA)

Friday: 14:30 Consumer data (USA)

$$3382 (-2,25%)

What's going on with Seven Eleven?

Do you already know Seven & i Holdings?

The distribution service company Seven & i Holdings is present in 15 countries with over 72,000 stores and 98,039 employees.

The annual turnover is 54 billion USD. In Japan, China and the USA, the company is particularly known for its 7-Eleven convenience stores. Other business areas include department stores, supermarkets, service stations and financial services.

-Market capitalization is the equivalent of EUR 33.5 billion.

-Profit for fiscal 21/22e is expected to be the equivalent of EUR 2.53 ( 20/21 = EUR 1.56 ).

-The dividend expectations for 21/22e are the equivalent of EUR 0.91 ( 20/21 = EUR 0.75 ).

-The P/E ratio for 21/22e is expected to be 14.62

( 20/21 = 23.71 ).

-Current share price: €37.55

Do you find Seven i Holdings interesting?

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Source: Seven i Holdings, Ariva.de

$S6M (-2,25%)