Lonza Launches White Knight Bid For Patheon
By Goran Mijuk and Martin Gelnar, Of DOW JONES NEWSWIRES
ZURICH -(Dow Jones)- Swiss chemicals maker Lonza Group AG (LONN.VX) Friday
launched a white knight bid to acquire Canada-based pharmaceutical industry
supplier Patheon Inc (PNHNF) for around $460 million.
Lonza's plan to buy Patheon comes after JLL Patheon Holding LLC, a unit of
U.S.-based investment firm JLL Partners Inc, made a hostile takeover bid for the
Canada-based drug maker in March.
"Our interest in Patheon is consistent with Lonza's strategy of expanding our
offering across the pharmaceutical manufacturing value chain," said Lonza Chief
Executive Stefan Borgas. He said a potential deal would be financed with cash
and bonds.
Patheon has repeatedly shrugged off JLL Patehon's acquisition plan, saying the
investment firm's bid of $2 per restricted voting share was too low. Patehon's
special committee, however, welcomed Lonza's bid of $3.55 per share bid.
"The Special Committee believes that Lonza's proposal would provide an
excellent opportunity to secure the future of Patheon, and that it is in the
best interest of shareholders to explore the proposal," said Paul Currie, who
heads the firm's special committee.
Patheon, which has more than 4,000 employees and reached revenues of more than
$700 million in 2008, supplies the pharmaceutical industry with packaging
services, catering more than 250 firms.
A deal, however, isn't imminent. Lonza said it will first conduct a thorough
due-diligence process that could consume around two months. Also, Lonza said the
acquisition would be contingent on its ability to buy 67% of Patehon. JLL
currently owns about 57% in the Canada-based firm.
Although Lonza said that a deal may fail to materialize, it said that a
potential acquisition could be earnings accretive within two years as the
takeover would strengthen its product pipeline.
Company Web Site:http://www.lonza.com
-By Goran Mijuk, Dow Jones Newswires, +41 43 443 80 47; goran.mijuk@
dowjones.com
(END) Dow Jones Newswires
08-21-090215ET
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