Dive Brief:
- Parkland’s largest shareholder, Simpson Oil, is attempting to take over Parkland’s board and restructure the convenience retailer, according to announcements from both companies.
- Simpson nominated nine independent directors to the company’s board in an attempt to “restore accountability and trust, unlock operational performance, and drive long-term value” in the Canadian retailer, according to a letter it sent Parkland’s shareholders on Monday. If the new board materializes, its first course of action will be unseating President and CEO Bob Espey, who has led Parkland since 2011.
- The clash comes as Parkland undergoes a strategic review to determine the company’s future course after years of underperformance and confrontations with Simpson, which owns nearly 20% of Parkland’s stock.
Dive Insight:
Parkland has been facing accusations of underperformance and calls for operational changes from both Simpson Oil and another major shareholder, Engine Capital, for years. The company’s strategic review includes evaluating several paths forward, such as mergers, divestitures, acquisitions and a sale of the business, which Engine Capital has repeatedly called for and Parkland has rejected.
The nominations are not Simpson’s first attempt to change Parkland’s board. The company was invited to nominate two members in 2023, leading to Marc Halley and Michael Christiansen joining the board. However, they resigned after seven months so Simpson “could freely press for overdue change to Parkland’s leadership and governance,” Simpson said on Monday
Halley and Christiansen are included in Simpson’s latest nominees to join the board. Parkland has also shared its proposed slate of 13 members, which includes three of Simpson’s picks.
Parkland called Simpson’s slate of nominees “a self-interested attempt by Simpson, a minority shareholder, to seize full control of Parkland without paying a control premium.” Michael Jennings, chair of Parkland's board, added that many of Simpson’s nominees “lack credibility and relevant experience.”
Simpson countered in its letter that its nominees would “hold the Board accountable for consistently quashing dissent, ignoring shareholders, failing at management succession and planning, lacking transparency, blocking value creation opportunities, and enabling a CEO whose undisciplined M&A strategy, poor integrations, and runaway spending have driven operational and strategic failure.”
The board membership vote will occur during Parkland’s annual shareholder meeting on May 6.
Parkland has also made a recent leadership change. The Canadian retailer has named interim Chief Financial Officer Brad Monaco as its permanent CFO, effective immediately. Monaco took over as interim CFO starting on Jan. 1 to replace Marcel Teunissen when he was elevated to president of Parkland USA.
