Shares of Japan-based Seven & I Holdings (JP:3382) surged after it received a proposal for a potential management buyout. The company received a confidential and non-binding acquisition offer from its Vice President and representative director Junro Ito, and his affiliated firm, Ito-Kogyo Co., Ltd. According to Bloomberg, the management buyout could be worth $58 billion. Investors responded positively to the news, with Seven & I shares rising nearly 12% in today’s trading session.
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Seven & I Holdings is a holding company that manages multiple businesses through its subsidiaries.
Seven & I Weighs Privatization Amid Foreign Takeover Pressures
Seven & I Holdings is exploring a plan to go private with this deal, aiming to fend off a takeover bid from its Canadian competitor Alimentation Couche-Tard (TSE:ATD). With the privatization deal, Seven & I will be able to operate under its existing management without shareholder pressure to divest more assets. This will also protect it from a potential takeover by foreign firms.
The company stated in its latest update that a special committee has been carefully and thoroughly evaluating the proposal with guidance from its financial and legal advisors. No final decision has been made yet.
In August, Seven & I Holdings received a record-breaking takeover bid from Alimentation Couche-Tard, which the Japanese group ultimately rejected. Couche-Tard later indicated that it was open to resuming talks. Meanwhile, Seven & I expressed willingness to continue discussions, provided future offers reflect the company’s true value and outline a clear, achievable path to completing the deal.
What Is the Target Price for Seven and I Holdings?
As per the consensus among analysts on TipRanks, 3382 stock has been assigned a Moderate Buy rating based on one Buy and two Hold recommendations. The Seven & I Holdings share price target of ¥2,417.31 implies an upside of 8.5% from the current share price level.
