Valeant sets price talk for restructured $3.2 billion two-part deal

By Paul A. Harris

Portland, Ore., June 25 - Valeant Pharmaceuticals International, Inc. set price talk for its restructured $3,225,000,000 two-part offering of senior notes (B1/B) on Tuesday, according to market sources.

An announced tranche of eight-year notes, which come with three years of call protection, is talked to yield in the 7½% area. The initial guidance was in the mid-6% range.

An added tranche of five-year notes is talked to yield in the 6¾% area.

Tranche sizes remain to be determined.

Meanwhile a planned tranche of 10-year notes has been withdrawn from the transaction. Initial guidance for those notes was in the high 6% to low 7% context.

Books close on Wednesday and the deal is expected to price on Thursday.

Goldman Sachs & Co. is the left bookrunner for the Rule 144A for life deal. BofA Merrill Lynch, Barclays, J.P. Morgan Securities LLC, Morgan Stanley & Co. and RBC Capital Markets are the joint bookrunners.

DNB Markets, SunTrust Robinson Humphrey, HSBC, Mitsubishi UFJ and TD Securities are the co-managers.

The issuing entity will be VPII Escrow Corp., a newly formed, wholly owned Canadian subsidiary of Valeant Pharmaceuticals International.

Proceeds will be used to help finance the acquisition of Bausch + Lomb.

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

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