Valeant debt refinancing to include $750 million new 8.6-year notes coming in Thursday drive-by

By Paul A. Harris

Portland, Ore., May 17 – Valeant Pharmaceuticals International, Inc. plans to price a $750 million offering of senior notes (Caa1) due January 2027 in a Thursday drive-by trailing a mid-morning conference call with investors, according to market sources.

Initial talk has the deal coming with a yield in the 8¾% area.

Goldman Sachs & Co. is the left bookrunner for the Rule 144A and Regulation S for life offering. Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., DNB Markets, J.P. Morgan Securities LLC, Morgan Stanley & Co. and RBC Capital Markets LLC are the joint bookrunners.

The notes become callable after four years at par plus 50% of the coupon.

The Laval, Quebec-based specialty pharmaceutical company plans to use the proceeds, along with an up to $1.2 billion new five-year revolver, a new upsized $4.565 billion term loan B and cash on hand, to refinance its outstanding term loan B and to redeem its 5 3/8% senior notes due 2020, its 6 3/8% senior notes due 2020, its 6¾% senior notes due 2021 and its 7¼% senior notes due 2022.

With the $750 million increase in the size of the term loan B, which was originally launched at $3.815 billion, a contemplated $750 million amount of senior secured notes was withdrawn from the refinancing, a market source said.

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