Thai group plans to buy 7-Eleven Indonesia
A Thai group plans to buy the 7-Eleven Indonesia convenience store chain.
Publicly listed Charoen Pokphand Indonesia says it will acquire the chain’s controlling company, Modern Sevel Indonesia, for Rp1 trillion (US$75 million).
It expects the purchase to be completed in June.
Modern Sevel has about 175 7-Eleven outlets, mostly in Jakarta. In Thailand, Charoen’s affiliate
Charoen Pokphand Group runs the 7-Eleven trademark with more than 9500 outlets.
Acquiring Modern Sevel would enable Charoen Pokphand Indonesia to expand its business into the distribution sector, while supporting its current business of processed food and beverages, the company says. The acquisition will be financed using the company’s internal cash reserves.
Charoen last year booked almost $3 billion in revenue from sales in Indonesia alone. The company has been expanding into the beverage segment to complement its chicken nugget products.
Meanwhile, Modern Sevel’s parent firm, Modern International, says it had has losses in recent years because of high competition and the need for “substantial” capital to develop the business. Jakarta decided in 2015 to ban alcohol sales at small retail stores, which at the time was a key driver of sales for Modern International.