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CALGARY — U.S. energy company Sunoco LP has signed an agreement to buy Parkland Corp. in a cash-and-stock deal valued at US$9.1 billion, including assumed debt.
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The deal comes as Calgary-based Parkland faces an attempt by Simpson Oil Ltd., its largest shareholder, to replace a majority of its board of directors.
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Parkland cancelled its annual meeting set for Tuesday and rescheduled it to June 24, when shareholders will also be asked to approve the Sunoco deal.
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Parkland executive chairman Michael Jennings said it is a compelling outcome for shareholders.
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“The board unanimously recommends the proposed transaction, recognizing Sunoco’s commitment to safeguarding Canadian jobs, retaining the Calgary head office, and further investing in Canada,” Jennings said in a statement.
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“This partnership creates significant financial benefits for shareholders and would position the combined company as the largest independent fuel distributor in the Americas.”
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Parkland and Cayman Islands-based Simpson have been at odds over the fuel refiner and retailer’s performance and governance for about a year.
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Simpson owns just under 20 per cent of Parkland’s shares and wanted nine of its directors added to Parkland’s board at a shareholder meeting, which has been postponed.
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Under shareholder pressure, Parkland said in March it would review options to boost its share price, including a sale of the entire company. Earlier this month, longtime Parkland CEO Bob Espey announced plans to step down before year-end.
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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.
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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.
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Parkland shares closed at C$36.28 on the Toronto Stock Exchange on Friday.
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In addition to shareholder and court approvals, the deal is subject to regulatory approvals, including approval under the Investment Canada Act. Sunoco has committed to maintain a Canadian headquarters in Calgary and significant employment levels in Canada.
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It has also committed to continuing to invest in Parkland’s refinery in Burnaby, B.C.
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This report by The Canadian Press was first published May 5, 2025.
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Companies in this story: (TSX:PKI)
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