The two companies announced the cash deal in a statement Sunday evening. It is one of the largest acquisitions in the world to be announced since the coronavirus pandemic struck earlier this year. Japanese retail giant Seven & i Holdings ( – which owns 7-Eleven and other outlets, including the Ito-Yokado supermarket chain and Sogo and Seibu department stores – claims it is the largest in the company’s history. )
Seven & i is the largest convenience store chain operator in Japan, with 21,000 stores. It also has nearly 9,800 stores in the United States and Canada. The company is looking to expand overseas as its domestic market becomes more and more saturated. By acquiring Speedway, the Japanese retailer would monopolize 4,000 stores and give a boost to its operations in North America.
With the deal, 7-Eleven would have a presence in 47 of the 50 most populous metropolitan areas in the United States, the company said in a press release.
The agreement “will allow us to continue to grow and diversify our presence in the United States, particularly in the Midwest and the East Coast,” Joe DePinto, president and CEO of 7-Eleven said in a statement.
Most convenience stores in the United States are located at gas stations. But analysts have long said that Seven & i could benefit from replicating the Japanese model of building stores in urban centers.
Despite this, investors were taken aback by the high price of the deal. Shares of Seven & I Holdings fell nearly 9% on Monday in Tokyo, its largest single-day percentage drop since March 23.
Along with many other retailers, Seven & i’s profits were hit hard by home orders during the pandemic. Net profits for the March-May quarter fell 73% to 13.9 billion yen ($ 131 million), and the company said it expects net profits to fall 45% at 120 billion yen ($ 1.1 billion) in the fiscal year ending February 2021.