business

COMMENTARY: Couche-Tard thinks big in bid to corner global C-store market

Peter Black, Local Journalism Initiative reporter

peterblack@qctonline.com

In a recent list of Quebec’s 15 wealthiest people, four come from the same company. One is listed number one and another number four. Chances are very few Quebecers or folks elsewhere in Canada could pick any of them out of a police lineup.

It’s also a safe bet that just about every Quebecer has patronized their business at one time or another, as have millions, if not billions of people in a huge chunk of the world.

Alimentation Couche-Tard is a global giant in the convenience store (C-store) industry by any measure. That the company started so small, with no family money to fund it, adds to the amazement of the tale.

The four Quebecers who founded the company in 1980, Richard Fortin, Réal Plourde, Jacques D’Amours and Alain Bouchard, could scarcely imagine the first dépanneur they opened in Laval would one day spawn an empire that would first be a major player in the C-store market in Quebec and the rest of Canada, then the United States, and now, vying to conquer the reigning global convenience colossus.

What’s the joke about some- one’s plan for world domination? To Bouchard, the

acknowledged driving force behind Couche-Tard, it’s obviously not a joke. And, yes, he’s number one on the list of Quebec’s richest people, and in the top 10 of any list of Canadian billionaires.

If you don’t read the business pages, Couche-Tard has been making headlines lately for the company’s attempt to acquire Japan’s 7-Eleven network, a bid that might be described as a python trying to swallow a rhinoceros.

The headline in the New York Times was instructive: “7-Eleven Gets Buyout Offer from Canadian Owner of Circle K.” The Times conspicuously declined to name Couche-Tard, the “Canadian owner,” likely because few readers would recognize the name and even fewer would know what the French term means.

Americans, of course, know Circle K, a dominant C-store brand in the United States, with more than 7,000 outlets across the country. Couche- Tard’s acquisition of Circle K 20 years ago was, at the time, a very bold move by Bouchard.

Bold, of course, is Bouchard’s brand. His story begins in Chicoutimi, where his father’s construction business went bankrupt when he was nine, the suddenly imposed poverty becoming a motivator.

He began working at his brother’s dépanneur stocking shelves, and soon found himself working for another chain scouting locations for new stores. Along the way, he also picked up a solid business education.

Having mastered the knack for the dépanneur game, he and his partners opened their first store in Laval in 1980. What followed was a blinding spree of acquisition within Quebec, followed by moves into Ontario, the West and the Maritimes. The company adopted the Couche-Tard name and sleepy-eyed owl logo when it bought up stores under that brand in Quebec City.

The Circle K takeover, how- ever, launched Couche-Tard onto the global playing field, with the company also bagging stores in Scandinavia, the Baltic countries, Ireland, Poland, Hong Kong, Belgium, Germany, Luxembourg and the Netherlands.

Couche-Tard now has a presence in 29 countries, with more than 16,700 stores under different brands and 150,000 employees.

The move on 7-Eleven, though, is a new level of ambition for Couche-Tard. The parent company, Seven & i, owns 21,000 stores in Japan alone, plus thousands of stores throughout Asia.

While no amount has been officially divulged with the bid, industry watchers say it could be in the ballpark of $120 billion US. Couche-Tard is seeking financing help from two of the biggest funds in the land, the Caisse de dépôt et placement du Québec and the Ontario pension fund.

7-Eleven is asking the Japanese government to protect it from a foreign takeover, claiming it is a “core” business essential to providing services and supplies in the event of some disaster.

That argument has an echo of the French government’s rationale in blocking Couche- Tard’s bid last year for France’s largest C-store chain. Food security was the stated reason – certainly nothing to do with the indignity of a Quebec dépanneur upstart gobbling up the pride of French supérettes.

Whatever happens with the 7-Eleven adventure, Bouchard and Couche-Tard have secured their place at the summit of Quebec business success stories. The little dépanneur that could, indeed.