The Japanese owner of 7-Eleven convenience stores has agreed to buy Marathon Petroleum Corp's Speedway gas stations for $21 billion (€17.8 billion), brushing aside coronavirus concerns to return to the table five months after initially baulking at the deal.
The deal will help Seven & i Holdings Co Ltd shift focus beyond Japan, where its stores and supermarkets face a shrinking population, slow economic growth and tough price competition.
It boosts its 7-Eleven store count in the United States and Canada to about 14,000, adding to a portfolio fattened just three years earlier with a $3.3 billion purchase from Sunoco LP - furthering its convenience store lead over Canada's Alimentation Couche-Tard Inc.
Shares in Seven & i nevertheless fell 4.8% on Monday in Tokyo on worries about a price just $1 billion lower than what the company reportedly turned down in March.
At that time, analysts and investors said the price was too high given concerns about a pandemic-induced global economic slowdown. Oil prices and fuel consumption have fallen as more people work from home and avoid travel.
Seven & i President Ryuji Isaka said the retailer decided that expanding in the United States was still beneficial given a growing population and potential for convenience stores, regardless of the pandemic's hit to consumer spending.
"The coronavirus is not going to go on forever," Isaka told a conference call following the deal announcement. While he declined to discuss specifics on why the company returned to the deal table, he said: "We made the management decision that these assets will be a source of our growth in five years, 10 years down the road."
He said the retailer wanted to bolster food offerings at the U.S. stores, in the same way its Japanese 7-Eleven stores have become popular for their ready-to-heat meals and boxed lunches.
The 7-Eleven brand started in the United States, but the Japanese affiliate became far more successful as its 24-hour opening policy and franchise system proved a perfect match with a dense population and late-night work culture.
The global chain is now owned by Seven & i, one of Japan's biggest retail groups with a market capitalization of around $27 billion.