Proxy advisory firms ISS and Glass Lewis back Sunoco offer for Parkland

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CALGARY — Two proxy advisory services are recommending shareholders vote in favour of Parkland Corp.’s planned takeover by U.S. company Sunoco LP.

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Institutional Shareholder Services Inc. and Glass, Lewis & Co. are both endorsing the friendly cash-and-stock deal announced last month, which is valued at US$9.1 billion including assumed debt.

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Parkland owns the Ultramar, Chevron and Pioneer gas station chains as well as several other brands in 26 countries and a refinery in Burnaby, B.C.

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Parkland’s biggest shareholder Simpson Oil, which holds an almost 20 per cent stake, has said it plans to vote in favour of the offer. However, New York-based Engine Capital, which owns 2.5 per cent of Parkland’s shares, has said it won’t support the deal as it stands.

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The shareholder vote is set for June 24.

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ISS noted in a report that the deal came together in the last moments of a proxy context with Simpson, which had been pushing for a leadership overhaul and performance improvements.

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“Given this backstory, there are inherent concerns that the process was reactive, accelerated, and/or placed (Parkland) in a disadvantageous bargaining position, and thereby resulted in an offer that undervalues the company,” the ISS report said.

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“However, when viewed in proper context, there are compelling reasons to believe that this deal is the best path forward for shareholders.”

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ISS said the deal is a way for shareholders to “move on at a premium” from Parkland’s long-standing issues while still being able to benefit from its upside potential.

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Glass Lewis concluded in its report that while some shareholders, including Engine, were skeptical about the timing of the takeover announcement, it sees evidence that the Parkland board was motivated by the merits of the transaction and not solely self-preservation.

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The proxy firm said the deal offers a “credible path” toward resolving Parkland’s problems.

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“While shareholder scrutiny of the process is both understandable and appropriate, the terms of the agreement suggest that the board succeeded in negotiating a transaction that largely aligns with shareholder interests,” Glass Lewis said.

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This report by The Canadian Press was first published June 16, 2025.

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Companies in this story: (TSX: PKI)

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