Dive Brief:

• Activist investor ValueAct is taking its ongoing criticism of Seven & i Holdings to the next level, now urging the retailer to oust its president and longtime executive, Ryuichi Isaka, according to a Thursday report from Reuters.
• San Francisco-based ValueAct, which owns a 4.4% stake in the retailer, claims Isaka is responsible for Seven & i’s “flawed strategy,” which has frequently been called into question over the past few months. This is the first time ValueAct publicly said that Isaka is one of the four directors it's looking to replace at the company’s next annual meeting.
• This continues the series of back and forths between ValueAct and the retail conglomerate that began back in January 2022 when the investor urged Seven & i to spin off its c-store business into a separate entity.

Dive Insight:

Although ValueAct has criticized Seven & i’s overall leadership while urging it to spin off the c-store business, its latest knock against the company targets Isaka directly, with the investor saying the president has acted in bad faith since assuming the presidency in 2016. 

ValueAct’s latest announcement also pointed out that Seven & i’s board of directors hasn’t held a succession review for Isaka, according to Reuters.

“It is time to find a new president for Seven & i,” ValueAct wrote to Seven & i shareholders in an April 20 letter. 

Isaka, 65, has worked for Seven & i since 1980 and became a director for the company in 2002. He was named president in 2016 after his predecessor, Toshifumi Suzuki, also faced controversy over the company’s strategy.

Beyond calling for the ousting of Isaka, ValueAct also claims Seven & i recorded meetings with some of its team members without its consent, violating various privacy laws.

Just this week, Seven & i Holdings outlined why it declined to make ValueAct’s suggested changes, saying its proposal was based on a “superficial understanding” of how the company operates. Seven & i also appointed two new directors this week, neither of whom was among four potential directors recently suggested by ValueAct.

7-Eleven has more than 79,000 stores across 20 countries, including over 20,000 in Japan and 13,000 in the U.S.