Canadian-based firm Parkland Fuel Corporation is set to acquire Barbadian-owned SOL Investments Limited (SIL), acquiring 75 per cent stake in the region’s largest independent fuel marketer in a US$1.21 billion deal. The transaction announced yesterday will see SOL – which came close to buying the state-owned oil importer, the Barbados National Terminal Company Limited – acquiring 12.16 million common shares in the capital of Parkland.

When the deal is closed, the Simpson Group, through its ownership in SOL Limited, will own an approximately 9.9 per cent stake in Parkland, Canada’s largest and one of North America’s fastest growing independent marketers of fuel and petroleum products and a leading convenience store operator.

A statement issued by Parkland said the transaction, which it hopes to complete by the end of the year, was subject to “customary third-party consents and regulatory approvals, including approvals of the Toronto Stock Exchange”.

The SOL operating brands will remain in place, and the SOL business will retain key management and continue to be managed from the Caribbean,Parkland said.

The founder of SOL Limited said the transaction was a good move for his company

“I am 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 [Parkland’s President and CEO] strong leadership along with his exceptional management team,” he said.

“I am 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 GDP of more than US$200 billion, this is the perfect time to take advantage of the tremendous opportunities that abound in the Caribbean.”

Simpson said the development will also provide “a big boost of confidence for regional investment opportunities”.

For his part, Espey said the addition of SOL would extend Parkland’s global supply reach and enable it to continue to build its supply advantage to benefit its entire business. “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. 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,” he said.

Meantime, Parkland and SOL Limited will enter into a shareholders agreement that will allow either the Canadian company to elect to acquire the remaining 25 per cent shares, or SOL Limited to sell them.

SOL supplies and markets a total of 4.8 billion litres 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.