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Parkland says strategic review called for by Simpson Oil is unnecessary

Parkland Board says such a review not in the best interest of stakeholders.
4/15/2024
Pioneer Gas Bar at Night Canadian Press
Photo: The Canadian Press - Sean Kilpatrick

Fuel retailer Parkland Corp. says a strategic review of its business called for by its largest shareholder is unnecessary.

The Calgary-based company says such a review does not consider the best interests of the majority of its shareholders. 

"After careful consideration, the Board determined that pursuing this alternative would not serve the best interests of the Company and its shareholders," wrote Steven Richardson, chair of the Board. "Parkland's Board fulfils its responsibilities for the benefit of all shareholders, not at the direction of one."

The comments came after Simpson Oil Ltd. sent a letter to the Parkland board of directors last week that called for a review of strategic alternatives including a potential sale of the company.

In the letter, Simpson Oil writes

“As a supportive partner, we have consistently encouraged the Company to maximise value and returns to shareholders. The results have fallen short of our expectations. . . We have shared our concerns as long-term investors at both the Board and shareholder level. However, the Company appears disinterested in constructive feedback or recommendations for improvement from shareholders. This has compelled us to change our approach to protect our investment and our shareholder rights.”

Simpson holds a 19.7% stake in Parkland.

READ:  Parkland reports strong 2023 Q4 and record year-end results

It said last month it would evaluate its options to protect its shareholder rights once restrictions under an agreement that limited its ability to nominate and vote for board members at Parkland expired on March 31.

The company's two nominees on the Parkland board of directors resigned at the end of last year and it also waived its right to nominate two members to Parkland's board. 

This report by The Canadian Press was first published April 15, 2024, with additional files from Simpson Oil and Parkland Corp.

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