Japan's Seven & i reportedly considering management buyout of up to $58 billion

By Ritsuko Shimizu

TOKYO (Reuters) -Japan's Seven & i Holdings is considering launching a management buyout that would see the retailer go private in a deal that could be worth up to $58 billion, Bloomberg News reported on Wednesday.

The Nikkei newspaper also reported that the owner of the 7-Eleven convenience store chain was looking at an MBO but put the value of a potential deal at more than 6 trillion yen ($39 billion).

A Seven & i spokesperson said the information was not something released by the company.

Seven & i has come under increased pressure to boost corporate value and deliver more for shareholders after Canada's Alimentation Couche-Tard emerged in August with a takeover bid, aiming to create a global convenience-store powerhouse.

Couche-Tard has sweetened its offer to $47 billion, sources have previously said.

Going private would allow Seven & i to continue under its current management and remove the pressure from shareholders to sell off more of its assets - as well as eliminate the threat of a takeover by the Canadian owner of Circle K stores.

Seven & i has already started sounding about banks for funding the buyout, the Nikkei said. Japanese banks Sumitomo Mitsui (NYSE:SMFG ), Mitsubishi UFJ (NYSE:MUFG ) and Mizuho (NYSE:MFG ) were in talks to lend a combined 6 trillion yen for the management buyout, Bloomberg said.

Seven & i's founding Ito family and trading house Itochu could also take part in the acquisition, Bloomberg News said.

Representatives for Mitsubishi UFJ and SMFG declined to comment.

No one was immediately available for comment at Couche-Tard.



Trading in shares of Seven & i were suspended in Tokyo following the reports.

($1 = 154.73 yen)

 

Source: Investing.com