Japanese trading house Itochu on Wednesday announced a 581 billion yen ($5.4 billion) tender offer for the rest of convenience store FamilyMart, reports Reuters.
Itochu, which owns 50.1% of the FamilyMart chain, will offer 2,300 yen per share, a 31% premium to Wednesday’s closing price. The offer runs from Thursday through Aug. 24 and Itochu expects to delist FamilyMart if the bid is successful.
FamilyMart, Japan’s second-biggest convenience store chain with more than 16,000 outlets across the country, said it supported the offer.
Itochu said it wanted full control of FamilyMart in part to speed up decision-making at the chain, which competes with 7-Eleven, part of retail giant Seven & i Holdings, and Lawson), owned by trading house Mitsubishi.
The stores, ubiquitous in Japan and offering everything from “bento” pre-made meals to socks and underwear, have faced slower growth in recent years.
In addition to a shrinking population and sluggish consumer spending, the industry is also grappling with a shortage of workers and tough competition from drugstores, which started selling food following deregulation.
Full ownership would also allow Itochu to shift further away from the struggling energy and mining businesses to focus on the consumer sector, which offers more stability as well as a chance to leverage its other food operations. Itochu acquired Dole Food Company’s Asian fresh produce and worldwide packaged food business in 2013.
Full Content: Reuters