Couche-Tard gains ally in bid to take over 7-Eleven
The Artisan Partners International Value Team has sent a letter to the Board of Directors of Seven & i Holdings Co. Ltd. (SIH) urging the company to respond without delay to the enhanced USD18.19 per share bid offered by Alimentation Couche-Tarde Inc. (ACT), a 22% premium over Couche-Tard’s initial bid.
In the past week SIH announced a restructuring plan proposed by shareholders over four years ago that management has resisted until now. The belated adoption of the restructuring plan, the letter states, is a tactic “designed to impede and drive away a bona fide bid.”
The International Value Team’s letter asks the SIH Board to “grant ACT access to conduct due diligence and to negotiate a purchase price that maximizes value for SIH shareholders without delay. The price currently being offered by ACT is clearly superior to the speculative value that could potentially be achieved by implementing the restructuring plan at this late date.”
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“We urge the Board of Directors to grant ACT access to conduct due diligence and to negotiate a purchase price that maximizes value for SIH shareholders without delay. The price currently being offered by ACT is clearly superior to the speculative value that could potentially be achieved by implementing the restructuring plan at this late date,” the letter further states.
The letter also asks the SIH Board to take measures to upgrade transparency and accountability. The team implores the Board to make public the names of the directors serving on the Special Committee that is reviewing the ACT bid. The team also requests that president Ryuichi Isaka and managing executive officer Yoshimichi Maruyama step down from the Nomination Committee to provide greater neutrality and objectivity.
Finally, the International Value team suggests that the Compensation Committee make full disclosure of compensation practices for overseas executives and directors in keeping with standard best-in-class practice among SIH’s global peers.
“SIH has chronically suffered from ineffective oversight and accountability, resulting in a persistent valuation discount. At a critical juncture in its history, we encourage you to ensure fair, independent and transparent processes to maximize shareholder value,” the letter concluded.
