Analysis-Couche-Tard, 7-Eleven face early hurdle on store divestiture plan

Abigail Summerville and Anton Bridge

Tue, Apr 1, 2025, 3:01 AM 5 min read

By Abigail Summerville and Anton Bridge

NEW YORK/TOKYO (Reuters) - Convenience store concatenation giants Couche-Tard and Seven & i, who are taking steps to divest thousands of stores they collectively ain successful North America to easiness regulatory concerns up of a imaginable merger, are faced with an aboriginal trial for the program - attracting rival suitors for the stores.

The 2 store operators are apt to conflict to solicit offers from different convenience store chains that mightiness beryllium wary of their ain imaginable antitrust risks arising from specified a deal, according to radical acquainted with the substance and respective antitrust experts. Seven & one owns the 7-Eleven convenience store chain, which has much than 12,000 stores successful the U.S.

So far, astir of the funny buyers for the stores are backstage equity firms, the sources said. This creates a imaginable headache for Canada's Couche-Tard and Japan's Seven & one arsenic U.S. antitrust regulators typically frown upon backstage equity firms arsenic buyers of divested stores, arsenic they are improbable to beryllium semipermanent owners.

The U.S. Federal Trade Commission does not usually presumption concern firms arsenic desirable acquirers of divested stores since the private-equity concern exemplary prioritizes short-term returns, the experts added.

"The bureau volition person a beardown penchant for a strategical buyer," said Michio Suzuki, an antitrust spouse astatine Baker McKenzie successful Tokyo. "From their constituent of view, the divestiture purchaser should beryllium beardown capable to tally the divested stores arsenic a viable competitory unit."

The divestiture bundle projected by the companies consists of much than 2,000 U.S. stores. However, determination is nary precedent for private-equity ownership of convenience stores carved retired successful the aftermath of a large merger, experts said.

Financial acquirers person bought divested market and dollar stores retired of bigger retail mergers, but they person a mixed way grounds of moving them successfully.

For example, erstwhile Dollar Tree acquired Family Dollar successful 2015 for astir $9 billion, the FTC made the companies divest hundreds of stores. Dollar Tree picked concern steadfast Sycamore Partners arsenic the purchaser for 330 stores, but 2 years later, Sycamore sold the stores to Dollar General due to the fact that it could nary longer run them arsenic a viable standalone business.

Sources acquainted with Couche-Tard and Seven & one person argued that their divestiture bundle consists of competitory stores successful galore states that a backstage equity steadfast tin run successfully.

The companies, truthful far, person received aboriginal involvement from buyout firms, who are keen to research the accidental to ain scaled-up convenience store operations with a nationwide footprint, according to 5 sources. However, immoderate of the firms are cautious astir bidding connected an plus coming retired of a merger that is not adjacent adjacent to being signed, 3 of the sources said.