AP News

Valeant Pharma starts $2.25B debt offering

NEW YORK (AP) — Valeant Pharmaceuticals International Inc. said Wednesday that it launched a sale of $2.25 billion in debt to fund its proposed purchase of dermatology products maker Medicis Pharmaceutical Corp.

The Canadian drugmaker said a newly formed subsidiary is offering $1.75 billion in senior unsecured notes. The proceeds from that sale will be used to fund the purchase of Medicis, the conversion of Medicis' of own outstanding notes and to pay transaction costs associated with the purchase. Valeant itself will sell $500 million in senior unsecured notes, and said those notes will be used for general corporate purposes, including potential future acquisitions.

Valeant agreed to buy Medicis on Sept. 3 for about $2.6 billion in cash in a deal to strengthen its position in skin treatments and care. The boards of both companies have approved the deal. Regulators and Medicis shareholders will also need to approve the sale before it can close. Valeant and Medicis hope to complete the deal early next year.

Shares of Valeant rose 15 cents to close at $55.69. Medicis lost 2 cents to end at $43.47.

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