Shares in Japan's Seven & i plunge 7% after Couche-Tard withdraws $47 billion takeover bid

• Shares of Seven & i fell more than 7% Thursday as they resumed trading after a brief halt.
• Alimentation Couche-Tard on Wednesday announced pulling its $47 billion takeover offer for Seven & i Holdings.

Shares of Seven & i plunged Thursday as trading resumed following a brief halt after Canada's Alimentation Couche-Tard withdrew its $47 billion bid to acquire the Japanese company.

Seven & i stocks were trading 7.38% lower after declining more than 9%, data from LSEG showed.

Convenience store operator Couche-Tard announced Wednesday that it was pulling its takeover bid for Japan's Seven & i Holdings, citing a “persistent lack of good faith engagement.”

“There has been no sincere or constructive engagement from 7&i that would facilitate the advancement of any proposal, contrary to comments made publicly by 7&i representatives,” the Canadian retailer said in a statement.

The operator of 7-Eleven stores expressed disappointment at Couche-Tard's “unilateral” termination of talks and withdrawal of its bid, and said it disagreed with many of the company's “inaccurate statements,” according to a Google translation of Seven & i's statement in Japanese.

The company in 2024 rejected a buyout bid from Couche-Tard, which had initially made an offer of $14.86 per share in August last year, saying it “grossly undervalues” the company.

Couche-Tard then reportedly raised its offer in October by over 22% to $18.19 per share, valuing Seven & i at 7 trillion Japanese yen, or about $47 billion.

“As we have expressed many times, we do believe that fully combining our two companies is the most straightforward and effective way to maximize value to all stakeholders,” Couche-Tard said. “However, we are not able to effectively pursue this combination without deeper and genuine further engagement from 7&i leadership and the special committee.”

Trading in Seven & i shares was suspended on Thursday before resuming at 10.16 a.m. local time (Wednesday 9.16 p.m. ET)

“The moat of Japanese protectionism proved too much for Couche-Tard to cross,” said Andrew Jackson, head of Japanese equity strategy at Ortus Advisors.

He added it was always “highly unlikely” that the deal was going to be successful given Seven & i's positioning as “one of Japan's most successful global companies” and its classification as “core” to Japan's national security.

Seven & i Holdings replaced Ryuichi Isaka as CEO with outside director Stephen Dacus in May.