Seven & I Holdings, the Japanese operator of the 7-Eleven convenience store chain, appointed its first foreign CEO and handed him the task of overhauling its business to fend off a $47 billion overseas takeover bid and engineer a recovery.
After a tumultuous six months that began when it received a buyout offer from Canadian Circle-K operator Alimentation Couche-Tard (ACT), Seven & I announced its most far-reaching leadership and business restructuring on Thursday.
Lead outside director Stephen Dacus will succeed Ryuichi Isaka as chief executive on May 27, the company said.
Addressing reporters in Japanese and English, Dacus said talks would continue with Couche-Tard, but significant regulatory hurdles stood in the way of a merger.
“What I do not think our shareholders would want is for us to spend two plus years in limbo just for that to be rejected by the US courts,” he said.
Seven & I, which has more than 80,000 7-Eleven stores in 20 countries and regions, also said it agreed to sell its superstore unit to Bain Capital for 814.7 billion yen ($5.50 billion) and that it would sell down its ownership of Seven Bank to below 40%.
Additionally, the retail conglomerate said it will buy back about 2 trillion yen ($13.5 billion) worth of shares through fiscal year 2030, and pursue a listing of its North American convenience store subsidiary by the second half of 2026.
Seven & I has been the target of investor criticism over its capital allocation for years, and in August received the ACT buyout offer that was later raised to $47 billion.
In response, a group led by Seven & I’s founding Ito family mounted its own buyout offer, while the company’s management said they could chart an independent path to recovery.
Dacus told reporters he could identify with 7-Eleven franchisees as his father had been one, and that he’d worked the midnight shift in the store as a teenager.
The incoming CEO, who previously held executive roles with Walmart and Fast Retailing, also led a special committee vetting the takeover bids. The Ito family group failed to secure a reported $58 billion in funding for its offer, scuttling the deal late last month.
Dacus was replaced as head of the special committee by another outside director, Paul Yonamine, the company said on Thursday.
Seven & I shares surged 6.1% on Thursday after Bloomberg News first reported the share buyback plan.
The buyback looked like an attempt to “try to lift market value and fend off” Couche-Tard, said Lorraine Tan, a regional director at Morningstar.
“Fundamentally, one of my immediate concerns is how they are funding the dividends and buyback,” she said. “It appears that they will have to rely on borrowings but we note the talk of a listing for its US business.”