Japan's Seven & i expected to announce new CEO, restructuring plan

Lead outside director Stephen Dacus will likely succeed Ryuichi Isaka as chief executive at Seven & i, sources have told Reuters, putting a foreign-born executive in charge of the Japanese retail conglomerate for the first time. Seven & i, which has more than 80,000 7-Eleven stores in 20 countries and regions, will hold a board meeting and then announce the leadership change along with plans including the sale of non-core assets to Bain Capital, sources said.

Seven & i Holdings, the Japanese operator of the global 7-Eleven convenience store chain, is expected to announce a leadership change on Thursday and plans to restructure its business as it faces a $47 billion foreign takeover bid. Lead outside director Stephen Dacus will likely succeed Ryuichi Isaka as chief executive at Seven & i, sources have told Reuters, putting a foreign-born executive in charge of the Japanese retail conglomerate for the first time.

Seven & i, which has more than 80,000 7-Eleven stores in 20 countries and regions, will hold a board meeting and then announce the leadership change along with plans including the sale of non-core assets to Bain Capital, sources said. The company has been the target of investor criticism over its capital allocation for years, and in August received a buyout offer from Circle-K operator Alimentation Couche-Tard that was ultimately raised to $47 billion, a 35% premium to its current market capitalisation.

That set off a three-way tug-of-war between Canada's Couche-Tard, a buyout bid from Seven & i's founding Ito family, and company management who believed they could chart an independent path to recovery. Dacus, who previously held executive roles with Walmart and Fast Retailing, has also led a special committee vetting the takeover bids. The Ito family group failed to secure a reported $58 billion in funding for their offer, scuttling the deal late last month.

Dacus is set to be replaced as head of the special committee by another outside director, Paul Yonamine, the Nikkei reported on Monday. Shares of Seven & i plunged on Tuesday following a report it planned to reject the Couche-Tard offer, although the Japanese company said it was still considering the bid.

Seven & i is likely to sell most of its non-core business to Bain Capital for more than 700 billion yen ($4.7 billion), Bloomberg News reported on Wednesday citing people familiar with the matter. Isaka has been with the 7-Eleven operator since 1980, becoming its president in 2016. But his reign has been criticised by foreign investors, including ValueAct Capital, which tried to oust him in 2023 for pursuing what it said was a flawed strategy.

More recently, U.S.-based Artisan Partners urged the company to consider a competitive bidding process for takeover proposals. Isaka laid out an independent turnaround plan in October, aiming to roughly double sales to 30 trillion yen by 2030 by expanding overseas and focusing on fresh-food offerings.

If Couche-Tard succeeds in winning control of Seven & i, it would be the biggest foreign takeover of a Japanese company. Seven & i was classified as "core" to Japan's national security in September, although the finance ministry said at the time it would not create hurdles for a takeover. ($1 = 148.9700 yen)

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