Casey’s General Stores has confirmed it is in talks with 7-Eleven after receiving a US$2bn takeover bid from its larger US c-store rival.

The company said 7-Eleven, the world’s largest convenience retailer, had made an unsolicited offer worth $40 a share in cash on 2 September.

Casey’s has spent the last five months in the M&A spotlight after Canadian c-store retailer Couche-Tard went public with its interest in the business.

Casey’s board believes that the value of its business “substantially exceeds” $40 a share but it has agreed to discussions with 7-Eleven to explore whether a deal can be reached that reflects the “true value” of the company.

It added that there can be no assurances that a transaction will be reached and that it is under no legal obligation to provide an update on the discussions.

Before Casey’s revealed 7-Eleven’s interest, Couche-Tard had reacted positively to the news that there was a rival offer on the table. However, it expressed suspicion over Casey’s admission that there was a second suitor interested in the business, with Casey’s AGM scheduled in two weeks time.