Independent Valuation Indicates Unsolicited US$2.00 JLL Proposal Substantially Undervalues Patheon

    TORONTO, Feb. 20 /CNW/ - Patheon Inc. ("Patheon" or the "Company")
(TSX:PTI), announced today that independent financial advisor BMO Capital
Markets has provided the Company's Special Committee of independent directors
with a formal valuation that places the value of Patheon's restricted voting
shares within a range of US$4.20 to US$5.00 per share (C$5.29 to C$6.30 based
on exchange rates on February 19, 2009). This valuation was based on analysis
of a number of factors, including the Company's historical and prospective
financial information.
    JLL Patheon Holdings LLC ("JLL"), an affiliate of JLL Partners, Inc. of
New York, announced on December 8, 2008, that it intended to make an
unsolicited offer to acquire any or all of the outstanding restricted voting
shares of Patheon that it does not already own at a price of US$2.00 per share
in cash. The independent valuation was required by applicable securities laws
since the offer proposed by JLL would be considered an "insider bid". JLL
holds 1,650,000 restricted voting shares or 1.8% of the outstanding restricted
voting shares of Patheon. JLL also holds preferred shares convertible into
approximately 28.6% of the restricted voting shares of Patheon at a price of
$4.77 per share.
    Based on the valuation provided by BMO Capital Markets and the review it
has conducted to date with its legal and financial advisors, the Special
Committee unanimously believes that the proposed JLL offer substantially
undervalues the Company, its earnings potential and future growth prospects.
    The Special Committee believes that the JLL proposal would provide far
less value to shareholders than could be achieved if Patheon were to continue
as an independent company and successfully execute its five-year strategic
    It is the Special Committee's view that the JLL proposal is opportunistic
and, when announced, was attempting to take advantage of a rapidly declining
stock market and its impact on Patheon's share price. The JLL proposal was
also made immediately before Patheon announced positive results for fiscal
    "Patheon has taken significant steps to reposition its business and
increase its efficiency, and we expect to continue to make progress on our
strategic growth plan, for the benefit of all shareholders," said Paul Currie,
Chairman of the Special Committee. "We appreciate the input that we have
received from shareholders to date, and we look forward to continuing this
dialogue as we work to seize the exciting opportunities available under our
    The Special Committee has provided the independent valuation prepared by
BMO Capital Markets to JLL, which is now in a position to withdraw, revise or
proceed with its proposal. Should JLL proceed with a formal offer,
shareholders will have at least 35 days to consider the offer and the Board of
Directors would provide a recommendation to shareholders within 15 days of the
mailing of the offer.
    The Special Committee will continue to provide timely information to
shareholders as needed and reminds Patheon shareholders that no offer has yet
been made for their shares of the Company. There is no need for shareholders
to take any action at this time.


    Patheon Inc. (TSX:PTI; is a leading global provider of
contract development and manufacturing services to the global pharmaceutical
industry. Patheon prides itself in providing the highest quality products and
services to more than 300 of the world's leading pharmaceutical and
biotechnology companies. Patheon's services range from preclinical development
through commercial manufacturing of a full array of dosage forms including
parenteral, solid, semi-solid and liquid forms. Patheon uses many innovative
technologies including single-use disposables, Liquid-Filled Hard Capsules and
a variety of modified release technologies.
    Patheon's comprehensive range of fully integrated Pharmaceutical
Development Services includes pre-formulation, formulation, analytical
development, clinical manufacturing, scale-up and commercialization. Patheon
can take customers direct to clinic with global clinical packaging and
distribution services and Patheon's Quick to Clinic(TM) programs can
accelerate early phase development project to clinical trials while minimizing
the consumption of valuable API.
    Patheon's integrated development and manufacturing network of 11
facilities, and 6 development centers across North America and Europe, strives
to ensure that customer products can be launched with confidence anywhere in
the world.

    Caution Concerning Forward-Looking Statements

    This news release may contain forward-looking statements which reflect
management's expectations regarding the Company's future growth of operations,
performance (both operational and financial) and business prospects and
opportunities. These statements are made in the context of the risks and
uncertainties that are outlined in the Company's public documents, which can
be accessed on our website at or on SEDAR at

For further information:

For further information: Special Committee: John Lute, Lute & Company,
(416) 929-5883, Email; Patheon Investor Relations: Ms. Jean
Treadwell, Tel: (905) 816-8344, Email:

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