By Megumi Fujikawa

TOKYO--Uncertainty about the path forward for the Japanese owner of the 7-Eleven convenience-store chain is causing concern among some of its shareholders. Seven & i held its annual shareholders meeting on Tuesday amid speculation about whether it will ultimately accept a buyout proposal from Canada's Alimentation Couche-Tard.

At its headquarters in Tokyo, the company's leadership fielded questions on the next steps in its deal discussions with the owner of Circle K convenience stores.

Deal or No Deal: Ryuichi Isaka, who stepped down as chief executive on Tuesday, told shareholders that Seven & i's special committee remains engaged in constructive talks with Couche-Tard about a takeover. However, "it is not certain that a deal will be completed" due to antitrust issues, he said.

A shareholder asked if Seven & i's founding family would make another offer to take the company private, but Isaka declined to answer. The family made a privatization bid last year to counter the Couche-Tard proposal but failed to secure the financing needed.

Undervalued Stock: Another shareholder pointed out that Seven & i's stock has been struggling to rise despite the company's efforts to shore up profits. Isaka said the company is looking to increase total shareholder returns, while mulling Couche-Tard's proposal and working on revamping the business, including with the planned listing of its North American convenience-store unit.

Seven & i shares stood at 2,162 yen, equivalent to $15.14, as of Tuesday's close, compared with about 2,700 yen in November when expectations for the family's proposed buyout boosted the stock price.

Lack of Perspective: Some shareholders said the company needs to take better care of its franchisees. "Management should put franchisees' profits before those of Seven & i Holdings" as franchisees form the base of the convenience store business, a shareholder and former employee said after the meeting.

He said the company's business strategy lacks measures to help franchisees, such as increasing their incentives. Another shareholder expressed concern that franchisee owners won't get enough attention if Couche-Tard acquires Seven & i.

New CEO: Stephen Hayes Dacus replaced Isaka as CEO after receiving shareholders' approval. Dacus, an American with a Japanese mother, is the first foreigner to serve as the head of the Japanese retail giant. In a recent interview, Dacus said he aims to enhance Seven & i's global supply chain and invest more in improving stores.

Dacus told shareholders on Tuesday that he understands the importance of franchisees from his teenage experience of working at his father's store. He said he's committed to "making sure that the next 10 years is even better than the last 10 years."

Write to Megumi Fujikawa at megumi.fujikawa@wsj.com

(END) Dow Jones Newswires

May 27, 2025 04:18 ET (08:18 GMT)

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