Canada’s largest independent marketers of fuel and petroleum products, Parkland Fuel Corporation (Parkland), Wednesday announced that it had entered into an agreement with the Barbados-based SOL Investments Limited (SIL) to acquire 75 per cent of its operations.
SOL, a privately-held company owned by the Simpson Group, is the largest independent fuel marketer in the Caribbean with SIL being a wholly-owned subsidiary of SOL Limited.
SOL supplies and markets a total of 4.8 billion liters of fuel volume annually across 23 countries in the Caribbean and generated US$215 million in adjusted earnings before taxes, depreciation and amortization in the 12-month period ending June 2018.
According to a statement, the transaction will result in Parkland acquiring 75 per cent of the issued and outstanding shares in the capital of SIL for an estimated US$1.21 billion plus customary post-closing adjustments on a cash-free and debt-free basis.
SOL Limited will acquire 12.16 million common shares in the capital of Parkland.
“Upon closing the Simpson Group, through its ownership in SOL Limited, will own approximately 9.9 per cent of the issued and outstanding shares in Parkland and its intention is to remain a long-term investor in Parkland.”
The statement said that the remaining 25 per cent of the shares outstanding in SIL are subject to the Minority Purchase/Sale Right to which Parkland may elect to acquire or SOL Limited may elect to sell the remaining shares in the capital of SIL.
The addition of SOL will extend our global supply reach and enable us to continue to build our supply advantage to benefit our entire business,” said Parkland’s president and chief executive officer, Bob Espey.
“With its integrated supply chain backed by an extensive distribution network, fortress assets, a premier brand portfolio and an exceptional team, SOL has built a strong market position with unparalleled regional scale. Together, Parkland and SOL create a significant North American and Caribbean growth platform,” he said, adding ‘we are delighted to partner with the Simpson Group and welcome the opportunity to work with SOL’s strong management team to optimize and grow SOL’s industry leading retail and supply network through our combined scale and expertise.”
The founder of SOL, Sir Kyffin Simpson, said he was “exceptionally pleased to announce the coming together of Parkland and SOL, which will ensure an exciting and dynamic future for everyone.
“With a desire to continue to develop and grow the business through expansion in new areas, I am extremely blessed to bring in our good friends Parkland of Canada to the Caribbean. I have long admired Parkland as a company with their futuristic vision and energy, and I have been tremendously impressed with Bob Espey’s strong leadership along with his exceptional management team”.
Sir Kyffin said that he is “truly confident that this coming together with the fantastic team at SOL will be a complementary blend of cultures, ideas, technology and innovation.
“I am convinced that Parkland and SOL are perfectly matched to develop new and exciting opportunities, with renewed energy that will provide excellent avenues for the development of our people that will in turn enhance our customer experience and open new doors for great synergies and improved logistics.
“With 43 million people and a gross domestic product (GDP) of more than US$200 billion, this is the perfect time to take advantage of the tremendous opportunities that abound in the Caribbean,” he added.