TORONTO, July 30 /CNW/ - The Special Committee of Independent Directors of Patheon Inc. ("Patheon" or "the Company") (TSX:PTI) responded today to the announcement by JLL Patheon Holdings LLC ("JLL") that it intends to convert all of its Convertible Preferred Shares of Patheon ("preferred shares") into Restricted Voting Shares. The Special Committee also corrected inaccurate statements in JLL's announcement.

The conversion will be effective immediately and, in accordance with the terms of the preferred shares, will be effected on the basis of US$4.77 per Restricted Voting Share.

While JLL has announced the conversion of its preferred shares and made several incorrect and misleading allegations against the Special Committee, JLL continues to refuse to provide a fair offer to Patheon shareholders for their Restricted Voting Shares. JLL's inadequate and coercive offer remains unchanged, and JLL continues to pursue control of Patheon without offering fair value, including a fair control premium.

The Special Committee believes that the fact that JLL is willing to convert its preferred shares at an effective price of US$4.77 per share underscores the inadequate nature of its US$2.00 per share bid and that JLL recognizes the significantly higher value in Patheon shares. As at July 27, 2009, the aggregate liquidation preference of the preferred shares, payable on a liquidation or change of control of the Company, was US$181 million. This liquidation preference will be eliminated upon the conversion of the preferred shares. The effect of this elimination, at current market prices and at any price below US$4.77 per share, is to transfer value from JLL to the holders of Restricted Voting Shares. For example, at the US$2.00 bid price, the elimination of the liquidation preference would represent a transfer to the holders of Restricted Voting Shares of approximately US$105 million.

Shareholders are advised that the conversion by JLL will not affect the number of additional Restricted Voting Shares that JLL would require to take Patheon private through a subsequent acquisition transaction. Such a transaction would require approval by a two-thirds shareholder vote as well as approval by a "majority-of-the-minority". JLL requires a further 12.6 million Restricted Voting Shares to assure the required approvals.

The Special Committee notes that since May 20, 2009 JLL has taken up only approximately 250,000 additional Restricted Voting Shares, or less than 0.3%, of the outstanding Shares.