DALLAS AND CALGARY, ALBERTA — Sunoco LP (NYSE: SUN), a Dallas-based fuel distributor and operator, has entered into a definitive agreement to acquire Parkland Corp. (TSX: PKI), a Calgary-based owner and operator of gas stations, convenience stores and electric vehicle charging stations in North America and the Caribbean. Parkland’s retail store count totals nearly 4,000 locations operating under the Esso, Ultramar, Chevron, On the Run, Pioneer and Fas Gas Plus fuel brands.
Sunoco plans to acquire all outstanding shares of Parkland in a cash and equity transaction valued at approximately $9.1 billion, including assumed debt and the acquisition of Parkland’s Burnaby refinery in British Columbia, which produces 55,000 barrels of low-carbon fuels daily.
“This strategic combination is a compelling outcome for Parkland shareholders,” says Michael Jennings, executive chairman of Parkland. “This partnership creates significant financial benefits for shareholders and would position the combined company as the largest independent fuel distributor in the Americas.”
The acquisition was unanimously approved by the boards of directors for both companies. The deal is expected to close in the second half of 2025 upon the satisfaction of closing conditions, including approval by Parkland’s shareholders and customary regulatory and stock exchange listing approvals. Parkland’s board of directors has appointed a special committee of independent directors to oversee and lead the comprehensive review of the Sunoco acquisition.
Reuters reports that Parkland’s largest shareholder, Cayman Islands-based Simpson Oil Ltd., immediately criticized the deal.
Sunoco has secured a nearly $2.7 billion, 364-day bridge loan for the proposed cash consideration. As part of the transaction, Sunoco intends to form a new publicly traded Delaware limited liability company named SUNCorp LLC that will hold limited partnership units of Sunoco that are economically equivalent to Sunoco’s publicly traded common units.
Under the terms of the agreement, Parkland shareholders will receive 0.295 SUNCorp units and C$19.80 for each Parkland share, implying a 25 percent premium based on share prices on Friday, May 2. Parkland shareholders can elect, in the alternative, to receive C$44.00 per Parkland share in cash or 0.536 SUNCorp units for each Parkland share.
Sunoco plans to maintain a Canadian headquarters in Calgary and invest heavily in creating and preserving Canadian jobs, as well as expanding Parkland’s transportation energy infrastructure in Canada.
Barclays and RBC Capital Markets served as the exclusive financial advisors to Sunoco. Barclays and RBC Capital Markets provided committed financing. Stikeman Elliott LLP, Weil, Gotshal & Manges LLP, and Vinson & Elkins LLP acted as Sunoco’s legal advisors.
Goldman Sachs Canada Inc. and BofA Securities served as financial advisors to Parkland. BMO Capital Markets acted as financial advisor to Parkland’s Special Committee. Norton Rose Fulbright Canada LLP acted as Parkland’s legal advisor. Torys LLP acted as legal advisor to Parkland’s Special Committee.
Sunoco is a leading energy infrastructure and fuel distribution master limited partnership operating in over 40 states, Puerto Rico, Europe and Mexico. The company’s midstream operations include a network of approximately 14,000 miles of pipeline and over 100 terminals. Sunoco’s fuel distributor operations division includes approximately 7,400 Sunoco- and partner-branded locations.
Sunoco’s stock price closed on Monday, May 5 at $54.57 per share, down slightly from $55.24 a year ago.
Parkland’s stock price closed on Monday at C$38.38 per share, down from C$40.61 this time last year.
— John Nelson