Suncor Energy Inc. reached a deal with activist investor Elliott Investment Management LP to appoint three new directors to the Canadian oil sands company’s board and review its retail business for a possible sale.
The refreshed board will form a committee to conduct the review of the downstream assets, Suncor said Monday in a statement.
The retail group includes more than 1,500 gas stations and store locations operating under the Petro-Canada brand. Suncor rose 2.5% in premarket trading as of 7:40 a.m. in New York.
The new board members include former Talisman Energy executive Jackie Sheppard, ARC Financial partner Chris Seasons and former BHP executive Ian Ashby. Sheppard and Seasons will be part of the committee that will oversee the review of the retail business, along with director Russ Girling.
Elliott made a public demand in April for changes to the board and for a strategic review, and cited Suncor’s poor safety record as one reason for the stock’s underperformance compared with other Canadian oil sands producers.
Then, on July 7, a worker died at Suncor’s Base Plant mine in northern Alberta. Chief Executive Officer Mark Little departed the following day.
Suncor has installed Kris Smith, executive vice president for downstream operations, as interim CEO while it searches for a permanent replacement.
“I think the street wants him to be somebody from outside the company to change the culture,” Laura Lau, chief investment officer of Suncor shareholder Brompton Funds, told Bloomberg last week.
Source: Rigzone.com
