TORONTO – Patheon Inc. (TSX:PTI) shareholders have overwhelmingly approved of a takeover offer that values the company at US$1.4 billion, the company said Thursday while also announcing preliminary results showing that it almost broke even in the first quarter.
The contract drug manufacturer said the all-cash offer of US$9.32 per share from a group backed by Patheon’s largest shareholder, U.S. private equity firm JLL Partners, was approved by more than 99 per cent of those voting.
The bid, which was 50 per cent above the company’s market price shortly before the offer was made, would see JLL and European life sciences company Royal DSM combine Patheon into a new global contract drug manufacturer with 23 locations around the world and 8,300 employees.
The new company is to be owned 51 per cent by JLL and 49 per cent by Royal DSM. JLL Partners owned about 55.7 per cent of Patheon’s equity when the offer was made.
As a result, it will cost about US$582 million to buy out shareholders other than JLL and its affiliates.
Completion of the deal, which still requires court and other approvals, is expected by March 11.
Meanwhile, Patheon said it expects its loss from continuing operations will come in at about US$100,000 in the first quarter, a big reversal from the $51.4-million loss it suffered in the same period last year.
Revenue for the three months ended Jan. 31 was $266.7 million, up from $213.5 million a year earlier.