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7-Eleven operator to buy US stores from Sunoco for 364.6b yen
[TOKYO] Seven & i Holdings Co on Thursday said it would buy convenience stores and petrol stations from Texas-based Sunoco LP for about US$3.3 billion, as the Japanese retailer closes in on its goal to reach 10,000 North American outlets.
The operator of the 7-Eleven chain of convenience stores has been aggressively opening stores in Japan as well as the United States, where it has been acquiring stores from local retailers.
Its latest purchase comes as operators of traditional big-box retailers including Seven & i have been suffering weak sales as changing tastes and modest wage growth have prompted shoppers to defect to cheaper speciality chains and online outlets.
"The US convenience store market has growth momentum. We see opportunities there," Seven & i President Ryuichi Isaka said at an earnings briefing after announcing the Sunoco deal.
Seven & i runs general merchandise, department and speciality stores, but the bulk of its operating profit comes from convenience stores - or 86 per cent of 364.6 billion yen (S$4.61 billion) in the year through February.
In a statement, the firm said US unit 7-Eleven Inc has agreed to buy 1,108 Sunoco convenience stores and petrol stations in Texas and other states in August.
Sunoco currently operates about 1,350 retail fuelling sites and convenience stores under brands such as APlus and Stripes, the firm's website showed.
The deal would be the biggest by 7-Eleven Inc, known for its "Slurpee" frozen beverage. Most recently, 7-Eleven Inc acquired 79 stores in California and Wyoming from CST Brands Inc in July.
Seven & i has about 19,400 7-Eleven stores in Japan and 8,700 in the United States and Canada, including those run by franchisees. 7-Eleven Inc has said it aims to increase its number of stores to 10,000 over the three years through 2019.
In Japan, same-store sales in the year through February rose 1.8 per cent at the 7-Eleven chain, but fell 4.2 per cent at Seven & i's Ito-Yokado general merchandise stores.
A Japanese company which is now part of Seven & i opened a 7-Eleven store as a regional licensee in 1974. The then-new retail concept became so successful in Japan that the company later bought out the US owner of the convenience store chain.