ValueAct Capital wants the four directors of Seven & I removed due to "governance failures."

ValueAct Capital has recently called on 7-Eleven’s parent company Seven & i to remove four directors from its 14-member board due to “failed corporate strategy” and “governance failures.” ValueAct, which currently owns a 4.4% stake in Seven & i, has already called on the company’s management to spin off its 7-Eleven c-store chain, reported Reuters.

Before the call to remove four directors occurred, ValueAct supported six new directors who joined Seven & i last year.

Reuters reviewed a letter from ValueAct Capital that stated it had become frustrated that its engagement with Seven & i over several months had not led to the company adopting a strategy to grow faster and improve profitability and its market valuation.

The letter goes on to state a “conglomerate discount has persisted” because the management of most of the Seven & i businesses has repeatedly failed despite promises for “synergies” and structural reform.

Even though the letter did not mention how ValueAct would seek to remove the four directors, Seven & i President Ryuichi Isaka is among the directors ValueAct is seeking to remove, according to Reuters.

Reuters also noted that in a statement, Seven & i said it had received the ValueAct letter and that the board of directors would proceed to scrutinize and consider the contents of the proposal.

Based in Irving, Texas, 7-Eleven operates, franchises and/or licenses more than 13,000 stores in the U.S. and Canada. In addition to 7-Eleven stores, 7-Eleven Inc. operates and franchises Speedway, Stripes, Laredo Taco Co. and Raise the Roost Chicken and Biscuits locations. It is known for its iconic brands such as Slurpee, Big Bite and Big Gulp.

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