August 19, 2024 at 01:26PM
The Japanese owner of 7-Eleven has been approached with what would be the largest-ever takeover of a Japanese company. The deal speaks to foreign companies seeking to exploit the depressed yen.
In this case, the suitor is Canadian company Couche-Tard, the owner of Circle K convenience stores. The target is Seven & i Holdings Co and it was valued at USD$31 billion before the deal and jumped 23% today.
Indications are that Japanese management will rebuff the offer but it could go hostile in a move to take over the 85,000 retail locations worldwide.
The takeaway her is that corporates are seeing value in yen-denominated assets, though that’s somewhat eroded given the recent run in the yen. Even with a premium $40-50 billion still isn’t material to the yen but Warren Buffett has also been buying yen-denominated assets in the past two years.
It will take time to turn the ship but we’re likely in the final innings of yen weakness.
This article was written by Adam Button at www.forexlive.com.
