Valeant Pharmaceuticals plans loans, bonds for Bausch + Lomb buy

By Sara Rosenberg

New York, May 28 - Valeant Pharmaceuticals International Inc. plans on using new bank debt and bonds to help fund its $8.7 billion acquisition of Bausch + Lomb Holdings Inc., company officials said in a call on Tuesday.

The total debt package is expected to consist of about 55% of bank debt and about 45% of bonds, and the total debt cost will be in the 4½% to 5% range, officials remarked.

Goldman Sachs Bank USA is leading the financing.

Ratings are expected in the BB area.

Net debt to pro forma adjusted EBITDA will be around 4.6 times, but the company hopes to get leverage down below 4 times by the second half of 2014, officials added.

Other funds for the transaction will come from about $1.5 billion to $2 billion of new equity.

Of the total purchase price, about $4.5 billion will go to an investor group led by Warburg Pincus and about $4.2 billion will be used to repay Bausch + Lomb's outstanding debt.

Closing is expected in the third quarter, subject to customary conditions and regulatory approvals.

Valeant is a Laval, Quebec-based specialty pharmaceutical company. Bausch + Lomb is a Rochester, N.Y.-based eye health.

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