Valeant near deal to acquire Bausch & Lomb: source

Fri May 24, 2013 4:16pm EDT
 
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By Greg Roumeliotis and Jessica Toonkel

NEW YORK (Reuters) - Canada's Valeant Pharmaceuticals International is nearing a deal to acquire eye care company Bausch & Lomb Holdings Inc from Warburg Pincus LLC for about $9 billion, a person familiar with the matter said on Friday.

Valeant shares spiked to their highest level since 2001 and were up 13 percent at C$86.86 in afternoon trading in Toronto.

"This deal would not be too surprising given that Valeant has said it wants to do a big, mega deal and there are not that many candidates," said David Krempa, an analyst at Morningstar. "Still, I would not expect that they are done doing big deals."

The source that spoke to Reuters on Friday requested anonymity because the matter is not public. Montreal-based Valeant could not be immediately reached for comment. Bausch & Lomb and Warburg Pincus declined to comment.

The Wall Street Journal, which earlier reported on the talks over Bausch & Lomb, said a deal might come as soon as next week.

Separately on Friday, the U.S. Department of Justice said that ISTA Pharmaceuticals, which Bausch & Lomb acquired in March 2012 for $500 million, pleaded guilty to charges related to the drug Xibrom, including offering doctors kickbacks to prescribe it. ISTA will pay $33.5 million related to conduct from 2006 to 2011, Bausch & Lomb said in a statement.

"It kind of removes an obvious overhang," said a Valeant shareholder. But "I would expect that, regardless of whether Valeant was going to be interested in them or not."

The shareholder, who asked not to be named as the transaction is not complete, said it makes sense for Valeant to increase its clout in opthalmology by acquiring Bausch & Lomb.   Continued...