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Patheon Board Recommends Rejecting JLL Offer

March 26, 2009

Patheon's board of directors has recommended that shareholders reject JLL's recent $2 per share tender offer to take the company private.

Patheon's board of directors has recommended that shareholders reject JLL Partners' recent $2 per share tender offer to take the company private. The board, based on a unanimous recommendation of the special committee of independent directors, concluded that the offer undervalued Patheon's shares. JLL has three nominees and the board; all declared conflicts of interest and did not vote on the recommendation. Patheon chief executive officer Wes Wheeler also abstained from voting.

The board's recommendation noted that JLL's offer sidestepped a $100 million payment it would need to gain 30% of the company's Restricted Voting Shares. The board also noted that the $2 per share offer price is below the independent valuation the company recently received of $4.20 to $5.00 per Restricted Voting Share. That valuation was determined by BMO Capital Markets.

According to the company's press release, several major shareholders in the company do not consider JLL's offer strong enough and do not plan to accept the share price.
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