Seven & i considers IPO for North American units- report

In a significant move, Seven & i Holdings Co. is contemplating an initial public offering (IPO) for its North American convenience stores and gasoline stations business, Bloomberg News reported.

This strategy is part of a proposed ¥9 trillion ($60 billion) management buyout and aims to address financing concerns. The Ito family, founders of the company, is working on finalizing this proposal to present an alternative to the ¥7.1 trillion offer from Alimentation Couche-Tard Inc.

The proposed IPO is expected to generate over ¥1 trillion in cash, contributing to the repayment of ¥6 trillion in loans from major Japanese banks. Sumitomo Mitsui Financial Group (NYSE:SMFG ) Inc., Mitsubishi UFJ (NYSE:MUFG ) Financial Group Inc., and Mizuho (NYSE:MFG ) Financial Group Inc., along with other financial institutions, are anticipated to provide the necessary loans for the buyout.

The capital raised from the IPO would offer reassurance to these lenders regarding the swift repayment of the borrowed funds.

By considering the listing of its operations, the Ito family, in collaboration with Itochu Corp. (TYO:8001 ), is aiming to persuade the board of Seven & i to endorse their buyout plan over the one proposed by Couche-Tard.

The report also added that Seven & i plans to maintain a stake in the North American business post-IPO, ensuring continued involvement in this segment of their operations.

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Source: Investing.com