Parkland names oil refining veteran Michael Jennings to board as shareholders push for change

Open this photo in gallery:

Days after a New York hedge fund urged Parkland Corp. PKI-T to refresh its board of directors, the fuel retailer has added an industry veteran to its ranks.

Michael Jennings, who retired as chief executive of U.S. refining giant HF Sinclair Corp. last year, will join the board of Calgary-based Parkland on Feb. 10, the company announced Tuesday.

Engine Capital LP, which owns 2.5 per cent of Parkland, declined to comment on the appointment despite publicly calling on the company’s board in a letter Monday to stop “trying to entrench itself” and bring in new directors.

Parkland said Mr. Jennings’ appointment is part of the company’s “ongoing and strategic board renewal process.” But Engine, in its letter, said “the current board should not be responsible for its own refreshment process.”

“Although some of the current directors may have enjoyed success as executives at large companies, we believe many lack the governance pedigree and financial sophistication to effectively oversee Parkland,” the letter said.

Engine has been trying to persuade Parkland to cut costs and sell assets since last year. The company had previously set a target of selling $500-million in assets by the end of 2025 and reaffirmed that goal after Engine went public with its demands.

Late last year, two Parkland directors appointed by Simpson Oil Ltd. – a family-owned business based in the Cayman Islands that is Parkland’s biggest shareholder, with a 19.55-per-cent ownership stake – resigned after just seven months on the board.

Michael Christiansen and Marc Halley left after Parkland refused to name one of them chair, sources said at the time. The Globe and Mail did not identify the sources because they were not authorized to speak on board governance.

Since those two resignations, Simpson and Parkland have publicly disagreed over the current status of governance and nomination agreements that effectively banned Simpson from engaging in any activism against Parkland or soliciting bids to acquire the company. Simpson claims those agreements are no longer valid, while Parkland argues they remain enforceable. Engine, in its letter, urged Parkland not to “embark on a strategy that wastes millions of dollars by litigating” the dispute.

Parkland owns more than 4,000 gas stations and electric-vehicle charging terminals across Canada, the United States and the Caribbean, along with On the Run convenience stores. The company acquired most of its Caribbean presence from Simpson when it purchased the SOL refuelling chain in two transactions worth a combined $2.35-billion in 2018 and 2022.

Simpson obtained its ownership stake in Parkland through those transactions.

Parkland is not the first board position Mr. Jennings has accepted since his retirement. In April, 2023, he joined the board of directors of the Plaza Group, an international fuel marketer based in Houston, Tex., that counts Canada’s Cenovus Energy Inc. among its largest clients. He lives in Dallas with his wife, Stephanie, and has three grown children.