Cenovus sells Husky gas stations to Parkland, FCL
In a surprising move, Cenovus Energy Inc. is selling 337 Husky gas stations for a total of $420 million.
Federated Co-operatives Ltd. is to buy181 stations for $264 million, while Parkland Corp is to buy 156 of the retail fuel stations for $156 million.
Calgary-based Parkland Corp. says the deal will grow its retail presence in Greater Vancouver, Vancouver Island, Calgary, and the Greater Toronto Area.
"This acquisition is a natural fit for Parkland," said Donna Sanker, president Parkland Canada. "Consistent with our recently announced strategy to develop our retail network in key Canadian markets and diversify our retail business to better serve our customers, it provides an opportunity to create convenience destinations by expanding our On the Run convenience brand, enhancing food offerings, and strengthening the Parkland national network for JOURNIE Rewards."
This Acquisition includes 109 company owned sites and 47 dealer locations and is expected to add annual fuel volumes of approximately 400 million litres to Parkland's network.
"The Acquisition is a unique opportunity to expand our coverage in markets where Parkland has an existing supply advantage and offsets a portion of our planned organic growth capital," added Sanker. "We will convert a significant number of the company owned sites to On the Run and accelerate our plan to build a network of over 1,000 On the Run locations in Canada and the U.S. by 2025."
Saskatoon-based Federated Co-op says the deal is the largest acquisition in its history.
The acquired retail fuel sites include a mix of gas bars, on-site car washes and convenience stores. Once the deal is complete, FCL will transfer the sites to several independent local Co-ops across Western Canada to solidify the brand's footprint.
“This historic deal for our organization clearly aligns with our vision of building sustainable communities together and reaffirms our commitment to Western Canada, to our member-owned Co-ops and to their local members and customers,” said FCL CEO Scott Banda. “By increasing our retail footprint, we further strengthen our position to meet the needs of our local Co-ops and their communities into the future.
“This deal strikes a positive balance between the current and future needs of our Western Canadian customers,” adds Banda. “We are committed to enhancing the sustainability of our fuels and recognize the important role co-operatives play in responding to the needs of our communities, members and customers. Co-op is an integral part of so many neighbourhoods and communities. We’re looking forward to extending our reach, and continuing to fuel Western Canada, through this deal.”
The announcement comes less than year after Cenovus closed the Husky deal. Cenovus announced it was to acquire Husky Energy Inc. in October 2020 and closed in January 2021. The transaction was completed through a definitive arrangement agreement under which Cenovus and Husky agreed to combine in an all-stock transaction and Husky became a wholly-owned subsidiary of Cenovus, headquartered in Calgary.
The vision was to to create a resilient integrated energy leader with an advantaged upstream and downstream portfolio. The deal made Cenovus Canada’s number three oil and gas producer behind Suncor and Canadian Natural Resources.
Cenovus says it will retain its commercial fuels business, which includes approximately 170 cardlock, bulk plant and travel centre locations.
- with files from The Canadian Press