Dive Brief:
- Parkland Corporation is looking to sell 157 convenience stores with fueling stations in Canada, according to an announcement from advisory and real estate firms NRC Realty & Capital Advisors and Colliers, which are co-coordinating the sale.
- The stores are located in a variety of areas, from large cities to towns. They’re mostly in Quebec and Ontario, through there are some in Alberta, British Columbia, Manitoba and Saskatchewan. Some of the locations operate under the On the Run banner and offer fuel brands such as Chevron, Ultramar, Pioneer and FasGas.
- This comes about nine months after Parkland revealed it was looking to sell up to $500 million worth of non-core assets — including select retail sites — that no longer align with its business objectives.
Dive Insight:
Last May, Robert Espey, president and CEO of Parkland, said the retailer was in “advanced negotiations” to sell the first $200 million worth of these non-core assets. He also noted that the other $300 million would likely come from selling various retail assets in Canada that don’t generate a lot of cash flow, and that managing all of this would take one to two years.
At the time, Espey said that the cash generated by selling these assets would be used to reduce debt and increase Parkland’s overall shareholder value.
Almost a year later, Parkland’s leadership is ready to act on its plan to offload half a billion worth of assets, as the 157 stores now up for sale no longer fit the company’s long-term strategic objectives, Francis Lapointe, vice president of Canadian retail operations for Parkland, said in the announcement.
“The decision to divest these locations is part of our ongoing network planning and optimization process,” Lapointe said.
During Parkland’s fourth-quarter earnings call on Wednesday, Espey confirmed that these sites will be sold to “dealers that will own the business and continue to sell branded product through them.”
He also confirmed that these stores are part of Parkland’s $500 million divestiture program.
“We're just changing the operating model of those businesses and allowing us to pull some of the capital out,” Espey said.
According to the announcement, the stores will be packaged with long-term fuel supply agreements.
With 1,860 stores in its Canadian network, Calgary, Alberta-based Parkland is the largest independent fuel retailer and second-largest c-store operator in Canada.
