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For almost two decades, a Japanese company has controlled America's most popular convenience store chain. That could be about to change.
On Monday, Tokyo-headquartered retail conglomerate Seven & i Holdings, owner of 7-Eleven, said it had received a takeover bid from Canada's Alimentation Couche-Tard, operator of rival convenience store chain Circle K.
In a statement, Seven & i said it would review the proposal after setting up a special committee of independent directors, but has not decided whether to accept or reject the offer.
A change in ownership would be a big deal for a few reasons.
For one, Couche-Tard's bid marks the biggest attempt by a foreign entity to take over a Japanese company, per Dealogic data dating back to 1995, CNN reported.
An outside bid for a Japanese business is a relatively rare occurrence. Some Japanese companies such as car manufacturer Mazda have been part-owned by outsiders like Ford in the past, but it is rare to see Japanese companies give up majority control to foreign buyers.
One exception to the rule was Taiwan's Foxconn taking a roughly 66% stake in Osaka-based electronics giant Sharp following a $3.8 billion deal in 2016.
It could also trigger a huge shake-up of the company responsible for bringing hot dogs and Slurpees to its iconic convenience stores.
Shares in Seven & i jumped about 23% on Monday, valuing the company at about $38 billion. The Japanese company has been circled in recent years by investors convinced that it was undervalued.
Although Seven & i's 85,000-plus stores massively outnumber Couche-Tard's 14,000 sites, for instance, the Canadian company was worth almost twice as much as the 7-Eleven owner before news of the bid broke.
Investor pressure has risen after new rules were introduced in Japan last year to make mergers and acquisitions of domestic companies less difficult.
San Francisco-based ValueAct has also been tough on Seven & i in recent years. After the activist investor revealed a stake in 2021, it piled pressure on the Japanese company to restructure and put more focus on 7-Eleven over its other brands.
Seven & i had already started a shake-up of 7-Eleven stores in the US to make them more like their Japanese counterparts.
Though 7-Eleven started life as an American company in the 1920s, its Japanese branches have gained wider visibility and popularity given the greater variety of fresh food and snacks on their shelves that have make them an attraction for tourists.
