#Canada #Calgary #Parkland Corporation #Shareholder Value #Sunoco LP

Parkland Announces Strategic Transaction with Sunoco LP

In a significant move that emphasizes shareholder value, Parkland Corporation has revealed its management information circular concerning a major strategic transaction with Sunoco LP. This development positions Parkland for a transformative step forward, presenting remarkable benefits for its shareholders while laying the groundwork for sustainable long-term growth.

Immediate Value for Shareholders

The proposed agreement with Sunoco represents a crucial opportunity for Parkland's shareholders. The board of directors unanimously recommends approval of this strategic transaction, which comes with a compelling immediate value proposition. Shareholders will enjoy a 25% premium based on the volume-weighted average price of Parkland's shares and Sunoco units, effective as of May 2, 2025.

The options for shareholders include:

• - CAD 19.80 in cash and 0.295 ordinary units of SunocoCorp, which is projected to become a public entity listed on the NYSE, maintaining a stake in Sunoco;
• - CAD 44.00 in cash; or
• - 0.536 common units of SunocoCorp.

This flexibility allows shareholders to choose how they wish to benefit from the agreement, including potential participation in future revenue and dividends from the combined business.

Strategic Justification of the Agreement

By merging with Sunoco, Parkland aims to establish itself as one of the largest independent fuel distributors in North America. This strategic alignment offers both increased scale and stability, anticipating substantial improvements in profitability and cash flow. The collaboration will leverage each company's strengths, diversifying their portfolio across Canada, the U.S., and the Caribbean, thus minimizing sector-specific risks.

An expected CAD 250 million in annual synergies by the third year post-transaction will significantly enhance financial performance and shareholder returns. Furthermore, the industrial strength of the two businesses promises to bolster overall performance and resilience in the market.

Commitment to Sustainable Operations

The agreement signifies not just growth but a sustained commitment to responsible management and strategic investments in Canadian operations. With a Canadian headquarters remaining in Calgary, Sunoco is dedicated to expanding within Canada, including significant enhancements to the Burnaby refinery infrastructure. This commitment underscores a strong confidence in the Canadian market, where Sunoco has a historical presence.

Transparent Negotiation Process

The decision to pursue this agreement stemmed from thorough negotiations led by an independent Special Committee set up to guide Parkland's board of directors. After extensive deliberations, involving independent appraisals from advisory firms like Goldman Sachs and BofA Securities, the board confirmed the fairness of the proposed compensation for shareholders.

The transaction is not contingent on financing conditions, reflecting Sunoco's steadfast commitment to executing the plan efficiently. Key approvals are still needed, including court clearance, shareholder votes, and regulatory endorsements, which will be conducted at the forthcoming annual general meeting.

Upcoming Annual Meeting Details

A pivotal date for Parkland shareholders will be June 24, 2025, when the company holds its annual meeting at the Calgary TELUS Convention Centre. Key votes will encompass the approval of the strategic agreement, election of directors, the designation of auditors, and an advisory vote on executive compensation. Shareholders will also review the audited financial statements for the fiscal year ending December 31, 2024.

With recommendations to vote in favor of all agenda items, the Parkland board emphasizes the importance of robust governance for navigating through this significant transitional phase.

In anticipation of the meeting, shareholders are urged to review the detailed information provided in the management circular and exercise their voting rights ahead of the June 20, 2025 deadline, thus ensuring their participation in this transformative evolution for Parkland Corporation.

Conclusion

As Parkland Corporation embarks on this strategic journey in partnership with Sunoco, the forthcoming chapter promises to shape the future of fuel distribution in North America. For more information on the transaction and to access the management circular, shareholders can visit ParklandSunoco.ca.