Valeant talks loan at Libor plus 250-300 bps, based on leverage

By Sara Rosenberg

New York, Sept. 23 - Valeant Pharmaceuticals International Inc. is talking its $1.7 billion 41/2-year senior secured credit facility at Libor plus 250 basis points to 300 bps, based on leverage, according to a market source.

Specifically, if leverage is 3.25 times or less, pricing is Libor plus 250 bps, if leverage is more than 3.25 times but less than or equal to 4.0 times, pricing is Libor plus 275 bps and if leverage is greater than 4.0 times, pricing is Libor plus 300 bps.

The facility consists of a $200 million revolver, a $1 billion term loan A and a $500 million delayed-draw term loan A.

The delayed-draw loan has a 50 bps unused fee.

All tranches are being sold as a strip.

Goldman Sachs & Co. and J.P. Morgan Securities LLC are the lead banks on the deal.

Although the deal launched with a bank meeting on Thursday, price talk was not announced until Friday morning.

Proceeds will be used to refinance existing senior secured credit facility debt.

Closing is expected in October, subject to market and other customary conditions.

Valeant Pharmaceuticals is a Mississauga, Ont.-based specialty pharmaceutical company that primarily focuses on the areas of neurology, dermatology and branded generics.

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