FamilyMart Will Be Controlled By Mining Company

Illustration. (Photo: Unsplash)

JAKARTA - The Japanese conglomerate Itochu Corp will buy 100 percent shares from FamilyMart Co. Itochu, which has a core business (core business) in the mining and energy sector, will later become full control of FamilyMart Co.

Quoted from the Nikkei, Thursday, July 9, Itochu will pour 581 billion yen or the equivalent of 5.4 billion US dollars to launch this action. Previously Itochu, had a 50.1 percent stake in Japan's second largest chain store.

Itochu offered to buy FamilyMart stock at a price of 2,300 yen per share. This figure is classified as a premium price because it is 31 percent higher than the closing price of FamilyMart shares, Tuesday, July 9.

The plan is for the tender offer or the bidding and buying process to run from July 9 to August 24. Itochu also hopes to fully master FamilyMart after all the processes are over.

FamilyMart, which has more than 16,000 outlets across Japan, is also reportedly supporting Itochu's plan. Itochu's grand plan is in order to compete with 7-Eleven, part of retail giant Seven & i Holdings, and Lawson Inc, which is owned by Mitsubishi Corp.

These retail shops in Japan offer all the necessities of everyday life, from pre-made bento foods to socks and underwear. However they have faced slower growth in recent years.

This is influenced by sluggish consumer spending patterns, and the industry is also grappling with a shortage of workers and intense competition for food vendors.

With full ownership of FamilyMart, Itochu's core business is likely to shift from mining and energy to the food and beverages sector. Itochu considers the consumption sector to offer more stability as well as opportunities to expand other types of food businesses.

This is in line with Itochu's previous steps in acquiring fresh products from Asia Dole Food Company.

However, after controlling 100 percent of FamilyMart Co's shares, Itochu will sell its 4.9 percent stake to Norinchukin Bank for 57 billion yen and will retain ownership of 94.7 percent of the shares.

The COVID-19 pandemic is actually hitting retailers around the world. However, the presence of convenience stores remains the prima donna for consumers who still need items that are used daily.