Valeant Pharmaceuticals talks $750 million tap of 5½% notes at par; pricing Tuesday

By Paul A. Harris

Portland, Ore., Nov. 14 – Valeant Pharmaceuticals International, Inc. talked a proposed $750 million add-on to its 5½% senior secured notes due 2025 (existing ratings Ba3/BB-) at par, according to market sources.

Although the order book is heard to be three-times oversubscribed, the size of the offering is not expected to grow, according to a bond trader, who added that the deal is going very well.

Books were scheduled to close at noon ET on Tuesday, and the deal is set to price thereafter.

Barclays is the left bookrunner. Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., DNB Markets, J.P. Morgan Securities LLC, Morgan Stanley & Co. and RBC Capital Markets LLC are the joint bookrunners.

The Rule 144A for life notes feature a make-whole call at Treasuries plus 50 basis points until Nov. 1, 2020, then become callable at 102.75. They also feature a 40% equity clawback at 105.5 until Nov. 1, 2020.

The Laval, Quebec-based specialty pharmaceutical company plans to use the proceeds to repay its series F tranche B term loans due 2022.

The original $1 billion issue priced at par on Oct. 2, 2017.

The add-on notes will immediately become fungible with the original notes.

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