JLL Partners To Invest in Patheon

Patheon, Inc. has entered into a definitive agreement with JLL Partners, under which JLL will purchase $150 million of Patheon shares. The transaction, subject to shareholder approval and customary closing conditions, is targeted to close by April 30, 2007. Patheon plans to use the investment proceeds (approximately $138 million) towards its outstanding debt of $238 million under its existing North American credit facilities.

“This investment will establish a stronger financial foundation for Patheon that will allow the company to continue to build on its position as a leader in pharmaceutical manufacturing and development services,” said Peter Green, chairman of Patheon. “In JLL Partners, we have found an experienced long-term investor who recognizes the strong fundamentals of Patheon’s business and shares our goal of building greater sustained value for all of our shareholders.”

“This capital restructuring is an important step forward for Patheon,” said Riccardo Trecroce, chief executive officer of Patheon. “We will now have the financial certainty and stability to ensure continued focus on superior client service, profitability improvement and manufacturing excellence — key elements of our plan to grow our business successfully.”

“Our investment in Patheon is based on our great confidence in the company and the tremendous opportunities before it,” said Ramsey Frank, senior managing director of JLL. “The company is extremely well positioned as a leader in the attractive market for drug development and contract manufacturing services for the pharmaceutical industry, with a talented management team and world-class operations.”

As a result of the investment, JLL will initially hold approximately 25% of the voting rights of Patheon. In addition, JLL will be entitled to elect three directors to the company’s nine-member board of directors (subject to reduction if JLL sells some of its shares), and will have certain other special approval rights and registration rights, according to a statement from Patheon.