Alimentation Couche-Tard has made a preliminary takeover offer for Seven & i Holdings, the operator of the 7-Eleven brand, which could mark the largest overseas acquisition of a Japanese company.

Seven & i's management has been criticized for inadequate corporate oversight, which has led to calls for significant changes amid the current acquisition discussions.

In response to the unsolicited bid, Seven & i is reportedly seeking government support to fend off the takeover attempt from the Canadian firm.

Seven & i has stated it is open to considering any proposals that align with shareholder value, but it will resist offers that undervalue the company or overlook regulatory concerns.

The company has expressed apprehension about the regulatory challenges that the acquisition would face, particularly from U.S. antitrust agencies.

Artisan, a shareholder in Seven & i, has urged the company to seriously evaluate Couche-Tard's offer and to explore bids for its Japanese subsidiaries.

The bid is priced at $14.86 per share, valuing the deal at approximately $38.5 billion, but Seven & i has indicated that this amount 'grossly' undervalues the company.

If the acquisition proceeds, it would create a distribution powerhouse with over 100,000 stores globally, significantly enhancing Couche-Tard's presence in North America.

In light of the takeover bid, Seven & i's board has formed a special committee of independent directors to evaluate the proposal while also seeking government protection.

The rejection of the bid comes amid a decline in the Japanese yen against the U.S. dollar, which has made Seven & i more attractive to foreign investors.

Despite the interest from Couche-Tard, Seven & i has maintained its position as Japan's leading retailer for 24 years, navigating competition from other convenience store chains.

Following the announcement of the buyout offer, shares of Seven & i rose over 20%, influenced by the weak yen and government encouragement of mergers and acquisitions.