Moody's: Valeant notes B1, loans Ba1

Moody's Investors Service said it assigned a B1 (LGD5-76%) rating to the new senior unsecured note offering of Valeant Pharmaceuticals International, Inc.

Moody's also assigned a Ba1 (LGD2-20%) rating to Valeant's incremental senior secured term loan A and term loan B.

There are no changes to Valeant's existing ratings, including the Ba3 corporate family rating, the Ba3-PD probability of default rating, the SGL-1 speculative grade liquidity rating, the Ba1 senior secured rating and the B1 senior unsecured rating, although Moody's is revising LGD point estimates on the existing debt instruments.

The outlook is negative.

Proceeds of the new debt instruments together with a recent equity offering are to be used in Valeant's acquisition of Bausch + Lomb.

"Valeant's acquisition of Bausch & Lomb will bring significant scale, diversity, synergies and cash flow accretion," Moody's senior vice president Michael Levesque said in a news release. "However, pro forma leverage exceeds management's previously communicated target of 4.0 times even with unrealized synergies, and aggressive financial policies and a rapid acquisition pace are reflected in the negative rating outlook."

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