On the precipice of an ugly boardroom battle, one of Canada’s largest retailers is trying to pull off an 11th-hour deal.
What happened: Calgary-based Parkland accepted a US$9.1 billion takeover offer from U.S. gas giant Sunoco. The deal comes as Parkland, which runs 4,000 gas stations under Esso, Chevron, and other brands, faces a fight with its top shareholder over control of the company.
- Parkland inked the multibillion-dollar deal just one day before it was set to face a shareholder vote that could’ve seen the majority of its board of directors replaced.
Catch-up: The company’s top shareholder, Simpson Oil, nominated nine new board members who were likely to be installed after a meeting today, had the Sunoco deal not come together.
- Shareholders will instead vote on the much more pressing issue of whether or not to greenlight the sale at their now-postponed meeting next month.
Why it matters: Boardroom drama aside, this is the first major test of Ottawa’s new rules around U.S. buyers acquiring Canadian companies. Under the updated guidelines, the feds can now veto U.S. takeovers that they believe undermine Canada’s economic security.
Bottom line: Ottawa’s main goal is to block acquisitions of Canadian companies that have had their value decimated by U.S. tariffs. Given the 25% premium that Sunoco is paying, this might not be the deal that the new Carney government wants to flex its regulatory muscles on.—LA