Parkland Reaffirms Its Support of Board & Strategic Review Process
CALGARY, Alberta — Parkland Corp. made a case for its preferred board of directors roster through a publicly released presentation that pushes back against the slate put forth by Simpson Oil Ltd., the company's largest shareholder and a frequent critic of its leadership.
According to Parkland, a refreshed, experienced and independent board is the right team to lead the company through its ongoing strategic review process.
"This is a clear attempt by a minority shareholder to seize full control of Parkland without offering a control premium to its fellow shareholders — and without the experience or qualifications required to oversee a complex strategic review," said Michael Jennings, executive chair of Parkland. "The hand-picked Simpson dissident slate lacks independence, expertise and credibility. In contrast, Parkland's board is highly independent, has significant and relevant expertise, and is committed to advancing a thorough process that delivers value for all shareholders — not just one."
Parkland's presentation comes days after President and CEO Bob Espey announced he will step down after 15 years, and weeks ahead of the company's scheduled Annual General Meeting.
In the presentation, the company criticized Simpson's nominees, labeling the slate as "unqualified, inexperienced and unfit" and only assembled for the purpose of giving the Simpson family "unchecked" control of Parkland.
According to Simpson, replacing incumbent board members with its nine nominees would hold the board accountable for what it views as "consistently quashing dissent, ignoring shareholders, failing at management succession and planning, lacking transparency, blocking value creation opportunities" and other missteps.
Parkland countered by alleging that Simpson, which owns just under 20% of the company, is seeking full control without paying a control premium to other shareholders.
It also alleged a pattern of disregard for fiduciary duties to all shareholders, claiming that the Simpson family's previously nominated directors circumvented established processes to privately solicit an offer from a bidder, prioritizing the Simpson family's personal financial interests over the broader shareholder base.
"Regrettably, this is not an isolated incident; similar behavior occurred several years ago during Parkland's negotiations to acquire Canadian retail assets," Parkland stated. "If the Simpson family succeeds in installing their chosen slate, shareholders can have no confidence they will act in the interests of anyone other than themselves. Their actions to date strongly indicate that future decisions would be designed to enrich the Simpson family — not maximize value for all shareholders."
Making a Case for an Independent Board
Parkland stressed that its current board comprises a supermajority of independent directors with deep expertise in energy, capital markets and corporate governance. Additionally, the current strategic review process being led by a special committee of the board is already attracting "significant" interest.
The strategic review process includes analysis and evaluation of Parkland's business strategies and optimization opportunities, as well as consideration of value maximization alternatives, as Convenience Store News previously reported. Alternatives could include, but are not limited to, asset divestments, acquisitions, transformative business combinations and a sale of the company.
"Over the past two years, Parkland has made significant changes to its board, appointing six new independent directors with exceptional track records across energy, governance and [merger and acquisition], chosen through multiple independent global search firms and our independent committee structure," Parkland wrote. "These individuals bring deep operational and strategic expertise — precisely what is required to oversee a company of Parkland's size and complexity, and to steward a successful strategic review process."
The company concluded by urging shareholders to vote only on the BLUE Proxy for Parkland's board nominees. Its full presentation is available for download here.
Calgary-based Parkland Corp. is an independent supplier and marketer of fuel and petroleum products and a convenience store operator. Parkland currently services customers across Canada, the United States, the Caribbean region and the Americas through three channels: retail, commercial and wholesale.