FTC may probe potential Seven & i, Couche-Tard deal, sources say By Reuters

By Abigail Summerville

NEW YORK (Reuters) -U.S. antitrust regulators have informed Seven & i it could probe a possible cope with Canada’s Alimentation Couche-Tard, two sources conversant in the matter mentioned, in an early signal {that a} merger might face regulatory scrutiny.

The Federal Commerce Fee despatched Seven & i a discover of its intent after Couche-Tard’s $38.5 billion provide for the Japanese retail big was made public on Aug. 19, the sources mentioned, requesting anonymity as a result of they weren’t approved to talk publicly concerning the matter.

The FTC reached out to the corporate and requested it to protect all paperwork which may be related to a overview of a possible acquisition by Couche-Tard, the sources mentioned.

The FTC declined to remark. Couche-Tard additionally declined to remark.

Seven & i has rejected Couche-Tard’s method, partly citing U.S. antitrust issues.

Seven & i’s companies embrace the Seven-Eleven comfort retailer chain in Japan and North America, whereas Couche-Tard companies embrace the Couche-Tard and Circle Ok comfort retailer chains in North America.

A supply conversant in the FTC’s considering mentioned the company notified attorneys from the businesses of their duty to advise shoppers to protect paperwork. Whereas there isn’t any indication that the 2 firms have destroyed any paperwork, the FTC is worried that protection attorneys are advising firms to destroy paperwork forward of antitrust investigations.

Current antitrust investigations which have included allegations of doc destruction embrace instances in opposition to Google (NASDAQ:) and Amazon (NASDAQ:).

Couche-Tard’s shares had been down 2.3% in noon buying and selling on Tuesday.

Beneath Chair Lina Khan, the FTC has been aggressive in analyzing offers for antitrust points. Different high-profile instances which have come beneath scrutiny embrace grocery chain Kroger’s (N:) proposed $25 billion acquisition of Albertsons (NYSE:), and style firm Tapestry (NYSE:)’s $8.5 billion deal to purchase Capri .

In an announcement final week, Couche-Tard highlighted its profitable monitor document of acquisitions and dealing with U.S. and different regulators. The corporate mentioned it will think about divestitures to safe regulatory approvals.

Seven & i has mentioned Couche-Tard’s proposal doesn’t “adequately acknowledge the a number of and vital challenges” it will face from antitrust authorities and “gives no certainty to closing.”