Bloomberg News

Bausch & Lomb Seeks $3.49 Billion of Loans to Refinance Debt

April 17, 2012

Bausch & Lomb Inc., the eye-care products maker owned by Warburg Pincus LLC, is seeking $3.485 billion in loans to refinance debt and back its acquisition of Ista Pharmaceuticals Inc. (ISTA:US), according to a person with knowledge of the transaction.

The financing will include a $2.035 billion term loan B, a $600 million term piece B which will be available to European investors, a $350 million delayed-draw term portion and a $500 million revolving line of credit, said the person, who declined to be identified because the terms are private.

The term loans will be covenant-lite, meaning they won’t have financial maintenance requirements.

Citigroup Inc. is arranging the financing for the Rochester, New York-based company and will host a lender meeting April 19 at 10 a.m. in New York, the person said.

The company’s existing term loan B due April 2015 was quoted at 100.25 cents on the dollar today, according to data compiled by Bloomberg. The debt pays interest at 3.25 percentage points more than the London interbank offered rate, the data show.

The loans will provide the company with financial flexibility for future growth opportunities, Adam Grossberg, a spokesman for Bausch & Lomb, said in an e-mailed statement.

Bausch & Lomb agreed to acquire Irvine, California-based Ista Pharmaceuticals in a deal valued at $500 million, according to a March 26 statement. The cash offer of $9.10 a share is 10 percent higher than Ista’s closing price on March 23.

Warburg Pincus, the New York-based private-equity firm with $30 billion in assets under management, acquired Bausch & Lomb for $3.96 billion in October 2007, Bloomberg data show.

In a revolving credit facility, money can be borrowed again once it’s repaid; in a term loan it can’t. So-called B loans are mainly bought by non-bank lenders such as collateralized loan obligations, mutual funds and hedge funds.

To contact the reporter on this story: Michael Amato in New York at mamato3@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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