7-Eleven operator cancels sale to CP Indonesia
Shares fall as turnaround plans face uncertainty
WATARU SUZUKI, Nikkei staff writer
JAKARTA -- Charoen Pokphand Indonesia's one trillion rupiah ($75 million) bid to acquire the operator of 7-Eleven convenience stores in Indonesia has been canceled, leaving the struggling retailer in limbo once again.
In a stock exchange filing on Monday, Modern Internasional, the parent company of 7-Eleven franchise operator Modern Sevel Indonesia, said the cancellation was "due to non-agreement of the parties concerned." A shareholders meeting scheduled for June 21 to vote on the sale has also been canceled.
Modern Internasional's stock fell as much as 7% during trading on Monday, leaving the company with a market capitalization of about 260 billion rupiah ($20 million). Shares of CP Indonesia were mostly unchanged.
The proposed acquisition, originally announced in April, came as Seven-Eleven and other foreign convenience store chains were struggling to compete with local food vendors and the rapidly growing networks of Alfamart and Indomaret, the country's top two local convenience store chains.
CP Indonesia, an affiliate of Thai conglomerate Charoen Pokphand Group, was expected to inject fresh capital and know-how to revive the moribund business. In Thailand, CP's listed retail unit CP All operates the world's second-largest network of 7-Eleven stores after Japan, with more than 9,500 locations.
Modern Sevel ran a total of 175 locations as of September 2016, most of which are in Jakarta.