An activist investor that pushed for changes at Parkland Corp. earlier this year is making new recommendations such as prioritizing share buybacks.
In a letter to the Parkland board, Engine Capital commended the company on the work it has done so far including changes at the board and plans to sell non-core assets.
However, Engine Capital says Parkland remains undervalued and is making a number of recommendations including refining the company’s capital allocation, better aligning management compensation with shareholders’ interests and simplifying its operations.
It is calling on the company to allocate a total of around $800 million for share repurchases in 2024 and 2025 with repurchases front-loaded in 2024 to take advantage of the stock undervaluation.
It also suggests Parkland pay down debt over the next two years by a total of around $600 million primarily using proceeds from asset sales.
Engine Capital says it owns about a 2.5 per cent stake in Parkland.
This report by The Canadian Press was first published Sept. 26, 2023.
Companies in this story: (TSX:PKI)
The Canadian Press
