Parkland posted a rise in third-quarter profit as it prepares to finalize its acquisition by U.S.-based Sunoco. The Calgary fuel and convenience retailer, which owns brands such as Ultramar, Chevron and Pioneer, said the transaction is set to close by Oct. 31.
BNN Bloomberg spoke with Ernest Wong, head of research at Baskin Wealth Management, who said the results were largely overshadowed by the pending deal. He added that the transaction signals a broader wave of consolidation in the fuel and retail space and shows promise for future foreign investment in Canada’s energy sector.
Key Takeaways
- Parkland’s third-quarter profit rose as it prepares to finalize its sale to Sunoco by Oct. 31.
- Few Parkland shareholders chose to take Sunoco stock due to unfavourable U.S. tax treatment.
- The deal highlights ongoing consolidation in the fuel and convenience store sector, leaving Couche-Tard as Canada’s key consolidator.
- Wong said the fast regulatory process and commitments to Calgary jobs signal investor confidence in Canada.
- The smooth approval could encourage more cross-border mergers in Canada’s energy and resource industries.
Read the full transcript below:
LINDSAY: Parkland has reported its third-quarter profit is up from a year ago as it prepares to complete its deal to be acquired by Sunoco. Calgary-based Parkland owns the Ultramar, Chevron and Pioneer gas station chains, as well as several other brands in 26 countries. For more on this, we’re joined by Ernest Wong, head of research at Baskin Wealth Management.
It’s good to have you. Thanks for taking the time.
ERNEST: Thanks for having me.
LINDSAY: So, beating expectations. But do the results really matter? Are they noteworthy, given this deal that’s going to go through soon?
ERNEST: Well, I think the market liked the results, and you’re seeing that reflected in the stock price of Sunoco. Given that a large chunk of this deal involves Parkland shareholders receiving Sunoco stock, that’s probably why you’re also seeing Parkland shares move up.
The one thing that was notable was that we now have clarity about when the deal will close — by Oct. 31. At that point, Parkland will cease to exist as a standalone company.
LINDSAY: So we’re getting more details on the deal. What stands out to you between these two companies?
ERNEST: What’s interesting is that there was very limited interest among Parkland shareholders in taking Sunoco Corp. units as part of the deal. That makes sense, given that most Parkland investors owned it for the dividend and have little interest in holding a U.S. dividend taxed at an unfavourable rate.
If we zoom out, this is part of a broader consolidation trend in the fuel distribution and convenience store space. In Canada, Alimentation Couche-Tard is now the only major consolidator left in the sector.
LINDSAY: Do you think Parkland’s deal with Sunoco is good for Canada?
ERNEST: Yes, I think it’s good news for investment in Canada. The regulatory process was very quick — shareholders approved the deal in June, Investment Canada Act approval came in October, and now it’s closing by the end of the month.
Initially, there were concerns about an American company acquiring strategic assets such as the Burnaby refinery and Canadian gas stations. But Sunoco committed to maintaining investment in the refinery and keeping its headquarters and jobs in Calgary. The quick approval process is encouraging and bodes well for future investment in Canada.
LINDSAY: We’re also seeing trade tensions between the U.S. and Canada. Could that weigh on this deal?
ERNEST: Maybe a little, but overall, we’ve been encouraged by what the prime minister has said about promoting investment in Canada — especially in diversifying markets for oil and gas. Over the weekend, Prime Minister Mark Carney met with Petronas to discuss investments for phase two of LNG Canada. That’s another positive sign for the energy sector.
LINDSAY: Do you think this deal could encourage more mergers and acquisitions in Canada?
ERNEST: Yes, especially given that most M&A activity in the commodity space has involved Canadian companies buying each other. A U.S. company being able to acquire a Canadian firm with a smooth approval process bodes well for foreign investment in the energy sector going forward.
LINDSAY: What about more mergers in the gas station and convenience store space?
ERNEST: In Canada, that sector is already quite consolidated, so we’re unlikely to see many large deals here. It’s a different story in the U.S., where the market is more fragmented. We own Alimentation Couche-Tard partly because it’s been a strong consolidator in the U.S. gas station space, and there’s still room for more growth there.
LINDSAY: Interesting. Ernest Wong, head of research at Baskin Wealth Management, appreciate your time. Thanks for joining us.
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This BNN Bloomberg summary and transcript of the Oct. 27, 2025 interview with Ernest Wong are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
