Major Canadian public pension fund the Caisse de Dépôt et Placement du Québec (CDPQ) has indicated its willingness to provide financial support to Alimentation Couche-Tard Inc as the convenience store giant pursues a potential takeover of Seven & i Holdings Co., the parent company of the 7-Eleven chain, Bloomberg has reported.
Vincent Delisle, head of liquid markets at CDPQ, confirmed in an interview that the fund is prepared to offer equity or debt financing to Couche-Tard if necessary.
"Couche-Tard knows that we will always accompany them in these endeavours if necessary,” Delisle stated.
CDPQ holds a significant stake in Couche-Tard, representing 3.5% of the company's shares.
According to Bloomberg, the fund has a long history of supporting Couche-Tard's growth and has benefited from the company's impressive performance, with annualised returns above 27% over the past 30 years.
While Delisle did not disclose specific financial details of a potential deal, CDPQ has demonstrated flexibility in providing both equity and debt financing in the past.
Charles Emond, CDPQ's chief executive officer, previously indicated that the fund could participate in a financing arrangement for a Couche-Tard acquisition.
A successful takeover of Seven & i by Couche-Tard would represent the largest foreign acquisition of a Japanese company to date.
The deal could have significant implications for the global market, signalling Japan's openness to foreign investment and its willingness to participate in international business transactions on a more equal footing.
But the path to a successful acquisition is not without its challenges.
Seven & i has already rejected Couche-Tard's initial offer, and the Japanese company is exploring other options, including the potential sale of its Ito-Yokado stores and supermarkets.
Analysts are closely watching the situation as Couche-Tard continues to evaluate its options.
While the company has a history of pursuing ambitious acquisitions, its approach is methodical and disciplined.
Ultimately, the outcome of this potential deal will depend on a variety of factors, including the negotiations between Couche-Tard and Seven & i, the financial terms of the transaction and the broader economic and geopolitical environment.
