Sunoco and Parkland Corporation announced that they have entered into a definitive agreement under which Sunoco will acquire all outstanding shares of Parkland in a cash and equity transaction valued at approximately $9.1 billion, including assumed debt.
Deal benefits
- The deal is immediately accretive, with 10%+ accretion to distributable cash flow per common unit and $250 million in run-rate synergies by Year 3. The combined company expects to return to Sunoco’s 4x long-term leverage target within 12-18 months post-close.
- Complementary assets enables advantaged fuel supply and further diversifies Sunoco’s portfolio and geographic footprint.
- Increases cash flow generation for reinvestment and distribution growth.
Commitment to Canada
- Sunoco will maintain a Canadian headquarters in Calgary and significant employment levels in Canada.
- Burnaby Refinery – Sunoco is committed to continuing to invest in Parkland’s innovative refinery, which produces low-carbon fuels, while maintaining safe, healthy and growing operations for the long-term. The refinery will continue to operate and supply fuel within the Lower Mainland.
- Sunoco will continue to support Parkland’s plan to expand its Canadian transportation energy infrastructure.
- The combined company’s expanded free cash flow will provide additional resources for reinvestment in Canada, the Caribbean, and the United States in support of both existing and new opportunities.
Deal terms: 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% premium based on the 7-day VWAP’s of both Parkland and Sunoco as of May 2, 2025.
Parkland shareholders can elect to receive C$44 per Parkland share in cash or 0.536 SUNCorp units for each Parkland share, subject to proration to ensure that the aggregate consideration payable in connection with the transaction does not exceed C$19.80 in cash per Parkland share outstanding as of immediately before closing and 0.295 SUNCorp units per Parkland share outstanding as of immediately before close.
For a period of two years following the closing of the deal, Sunoco will ensure that SUNCorp unitholders will receive the same dividend equivalent as the distribution to Sunoco unitholders.
Advisors: Goldman Sachs Canada and BofA Securities served as financial advisors to Parkland. And BMO Capital Markets acted as financial advisor to Parkland’s Special Committee. Norton Rose Fulbright Canada acted as Parkland’s legal advisor. Torys acted as legal advisor to Parkland’s Special Committee.
Barclays and RBC Capital Markets worked as the exclusive financial advisors to Sunoco. And Barclays and RBC Capital Markets provided committed financing. Stikeman Elliot LLP, Weil, Gotshal & Manges LLP, and Vinson & Elkins LLP acted as Sunoco’s legal advisors.
KEY QUOTES:
“This strategic combination is a compelling outcome for Parkland shareholders. The Board unanimously recommends the proposed transaction, recognizing Sunoco’s commitment to safeguarding Canadian jobs, retaining the Calgary head office, and further investing in Canada. This partnership creates significant financial benefits for shareholders and would position the combined company as the largest independent fuel distributor in the Americas.”
Michael Jennings, Executive Chairman of Parkland
“Today marks a significant milestone. This transaction delivers immediate value for shareholders, including an attractive 25% premium. Sunoco shares our commitment to growth, customer service, operational excellence, and ongoing investment in Canada, making our combined business stronger and better positioned for sustained success.”
Bob Espey, President and CEO of Parkland
