Parkland CEO to step down in bid to diffuse conflict with activist shareholder

Yahoo

16-04-2025

Parkland Corp.'s long-serving chief executive Bob Espey says he will step down in a bid to resolve the embattled fuel retailer's troubles with activist shareholders.
The announcement comes as the bitter dispute between Parkland and its largest shareholder, Simpson Oil Ltd., threatened to come to a head at the Calgary-based company's upcoming annual general meeting on May 6, with Simpson calling for Espey's removal and for a whole new slate of directors to be installed.
'Over the past few months, it became clear that stepping down and announcing my departure may help bring resolution to the situation with Simpson Oil Ltd. and benefit all shareholders,' Espey said in a press release on Wednesday announcing plans for his departure and Parkland chair Michael Jennings's appointment as executive chair effective immediately.
'I remain deeply committed to Parkland and will support a smooth transition to new leadership. I look forward to working closely with Michael in his new role as executive chair.'
Espey will stay on until a new CEO can be appointed, the company completes its previously announced strategic review or Dec. 31, whichever occurs first, the company said.
His 15-year tenure at Parkland took the company from a few hundred gas stations in Canada to an international fuel distributor and refiner with 4,000 locations across North America and the Caribbean under brands such as Esso, Chevron, On the Run, Ultramar, Pioneer and Fas Gas Plus.
'Bob has led Parkland through a period of exponential growth, transforming the company from a small regional fuel retailer into one of Canada's leading fuel and convenience retailers with international operations in 26 countries,' Jennings said in a statement. 'We thank him for his unwavering commitment and dedication.'
But in recent months, Espey and Parkland's board have come under intense pressure from activist shareholders Simpson and U.S. hedge fund Engine Capital LP, which have accused the company of mismanagement and underperformance.
Bowing to activist pressure last month, Parkland launched a strategic review of the company's assets and options, including the potential sale of the company, and appointed new directors to the board. The appointments were dismissed by Simpson as 'tinkering' that has not addressed the root of the company's problems.
Parkland's rocky history with its largest shareholder began in 2019 when it purchased a Caribbean convenience and fuel marketing company that was a subsidiary of the Cayman Islands-based Simpson Oil.
The relationship appeared to take a turn in November 2022 when Simpson, which owns nearly 20 per cent of Parkland's shares, met with Parkland's management to discuss the company's share price returns, financial performance and 'strategic missteps.'
The relationship soured further when Simpson took Parkland to court last year in a lawsuit over shareholder rights that resulted in the Ontario Superior Court of Justice siding with the activist investor.
In a preview of its first-quarter earnings on Wednesday, Parkland said it is forecasting adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $375 million, and noted a write-down against its earnings of around $55 million related to its decision to wind down its Californian compliance market position.
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The company said it expects full-year EBITDA to be toward the lower end of its previously announced range of $1.8 billion to $2.1 billion in 2025, based on current market conditions.
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