Parkland Corp.’s largest shareholder, Simpson Oil Ltd., is no longer bound by the voting and standstill restrictions in the convenience retailer and fuel marketer’s governance agreement.
Calgary, Alberta-based Parkland Corp. shared this update on its website Monday, and said the Ontario Superior Court of Justice had reached this decision.
Parkland Corp. is No. 38 on CSP’s 2024 Top 202 ranking of U.S. convenience-store chains by store count.
Both Simpson Oil and Parkland entered into the governance agreement in 2019, which was designed to protect the interests of Parkland’s other shareholders, it said.
“Parkland has always been open to representation from Simpson Oil on its board. This decision does not change that,” Parkland said in a statement on the court’s decision. “Parkland remains focused on acting in the best interests of all shareholders to maximize value and executing its long-term strategy. The company will continue to engage with shareholders and focus on the strong operational foundation that supports Parkland’s success.”
Simpson Oil on Aug. 13 said it filed an application with the Ontario Superior Court of Justice seeking a declaration that standstill and voting restrictions under a governance agreement have ceased to apply based on “a material change in the composition of Parkland’s senior management since Jan. 8, 2019,” the day the agreement between Simpson Oil and Parkland Corp. was dated.
Since 2019, there has been “substantial churn” of Parkland senior management while performance of the company has suffered, Simpson Oil said at the time it filed the application. Seven of the 10 people identified as members of Parkland’s senior management team in its 2018 Annual Information Forum have left or ceased to be senior managers, the Grand Cayman, Cayman Islands-based firm said.
Simpson Oil entered the governance agreement in 2019 as part of a transaction where Parkland acquired 75% of Simpson Oil Investment, resulting in Simpson Oil becoming a significant shareholder of Parkland, Parkland said. Governance agreements are a common instrument, where a transaction creates a significant shareholder, designed to assure certainty and stability to the company and help protect the rights of all other shareholders, Parkland said.
Parkland Corp. is an international fuel distributor, marketer and convenience retailer with operations in 25 countries across the Americas. It uses the On the Run brand for its c-stores, among other regional brand names from companies it has acquired.
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