CALGARY — Parkland Corp.'s biggest shareholder is going to court after the Calgary company announced a US$9.1-billion takeover by Sunoco LP and delayed a meeting where it was to face down investors pushing for a boardroom overhaul.
A showdown had been set to take place in Calgary on Tuesday, with shareholders voting on competing director nominee slates put forward by Parkland's management and by Simpson Oil, which owns just under 20 per cent of the Canadian fuel retailer and refiner's shares.
Parkland and Cayman Islands-based Simpson have been at odds over the fuel refiner and retailer's performance and governance for about a year.
Parkland's meeting has been rescheduled to June 24, when Parkland shareholders are to vote on a cash-and-stock deal with Dallas-based Sunoco that would create the largest independent fuel distributor in the Americas.
Simpson says it has applied to the Alberta Court of King's Bench to hold the annual meeting as planned, calling the delay a "deplorable tactic" and a bid to "cling to control" by the existing board.
Simpson says no action should have been taken under a new board of directors supported by shareholders was in place.
"Delaying the meeting and pushing forward with any transaction ahead of board transition represents a clear breach of fiduciary duty — an obvious attempt to cling to power and sidestep shareholder will," Simpson said in a statement Monday.
Simpson is calling on all 11 incumbent Parkland directors to resign immediately, including executive chair Mike Jennings.
The cash-and-stock deal between Parkland and Sunoco announced Monday requires shareholder and regulatory approval and also has to be cleared under the Investment Canada Act. The U.S. company has committed to maintain a Canadian headquarters in Calgary, significant employment in Canada and investment in Parkland's refinery in Burnaby, B.C.
"This combination with Sunoco provides Parkland's shareholders with the highest value and the greatest proceeds, while also affirming Sunoco's and Parkland commitment to Canada, a country that has played a vital role in our combined history," said outgoing Parkland chief executive Bob Espey.
"Sunoco is a strong organization and clearly the right choice for Parkland."
Espey, who had been at the helm for 17 years, announced earlier this month that he would step down before year-end.
Under shareholder pressure, Parkland said in March it would review options to boost its share price, including a sale of the entire company, an action it had earlier said was unnecessary.
As part of the deal, Sunoco intends to form a new publicly traded company named SUNCorp LLC that will hold limited partnership units of Sunoco that are economically equivalent to Sunoco's publicly traded common units.
Parkland shareholders will receive 0.295 SUNCorp units and C$19.80 for each Parkland share. Parkland shareholders may also elect to receive C$44 per Parkland share in cash or 0.536 SUNCorp units for each Parkland share, subject to limits. The cash-and-stock deal also includes Parkland's assumed debt.
Parkland shares closed at C$36.28 on the Toronto Stock Exchange on Friday. Its shares rose more than seven per cent to C$39.86 late morning on the TSX.
This report by The Canadian Press was first published May 5, 2025.
Companies in this story: (TSX: PKI)
Lauren Krugel, The Canadian Press
