`
` Michael J. de la Merced
`
`Ma 27, 2013 9:29 am
`7:54 p.m. | Updated
`
`Bausch & Lomb, the eye care company, agreed on Monday to sell itself to
`Valeant Pharmaceuticals International of Canada for about $8.7 billion,
`sidestepping the lengthier process of an initial public offering.
`
`Under the terms of the deal, Valeant will pay $4.5 billion to the investor
`group that owns Bausch & Lomb, led by the private equity firm Warburg
`Pincus. It will also spend about $4.2 billion to repay Bausch & Lomb’s debt.
`
`The agreement continues the flurry of dealmaking in the health care
`industry, as companies seek to buy the growth they are hardpressed to
`generate on their own. Announced merger volume in the sector this year is up
`14 percent from the period a year earlier, even as takeovers have fallen 8
`percent.
`
`Related Link
`Document: Joint news release
`
`Valeant, based in Laval, Quebec, has made acquisitions a core part of its
`growth strategy as it has become a big specialty drug maker. The Bausch &
`Lomb deal is the company’s biggest, over three times the value of its $2.6
`billion purchase of the skin care company Medicis Pharmaceutical last year.
`
`Adding Bausch & Lomb, a giant maker of contact lens solution and
`surgical devices, will significantly bolster Valeant’s offerings in the sector.
`
`4/7/2015
`
`Eye Care Company Is Being Sold to Valeant NYTimes.com
`
`http://dealbook.nytimes.com/2013/05/27/bauschlombtosellitselftovaleantfor87billion/
`
`1/3
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`SENJU EXHIBIT 2205
`LUPIN v SENJU
`IPR2015-01105
`
`PAGE 1 OF 3
`
`
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`Bausch & Lomb will absorb its new parent’s existing ophthalmology
`operations, creating a business that is expected to generate more than $3.5
`billion in net revenue this year.
`
`“We believe it’s a great move for the company,” J. Michael Pearson,
`Valeant’s chief executive, said in an interview by phone.
`
`While Bausch & Lomb’s products don’t necessarily include home runs,
`Mr. Pearson said, “there’s an opportunity for a lot of singles and doubles here.”
`
`Brent Saunders, the chief executive of Bausch & Lomb, said in a
`statement: “Our companies have a shared commitment to providing
`innovative and highquality products and exceptional service to customers.”
`
`The takeover also means a tidy payday for Warburg Pincus, which led a
`$4.5 billion leveraged buyout of Bausch & Lomb in 2007. The firm already
`benefited from a $772 million special dividend that Bausch & Lomb paid out in
`March, the bulk of which went to its controlling investor group.
`
`Through the deal, Warburg Pincus is expected to reap a return of as much
`as three times its original investment, according to a person briefed on the
`matter.
`
`Warburg Pincus began exploring a sale or initial public offering for
`Bausch & Lomb late last year and held preliminary talks with a number of
`potential bidders. Among them was Valeant, though Mr. Pearson said that at
`the time he and his board could not justify paying the more than the $10
`billion that Warburg Pincus was seeking.
`
`Instead, Bausch & Lomb filed in March for an initial public offering.
`
`Until last month, Valeant was pursuing a takeover of a different company,
`the generic drug maker Actavis, in what would have been a deal worth over
`$13 billion. When those talks collapsed, Valeant then turned to Bausch &
`Lomb. Mr. Pearson said the bulk of the work on Monday’s transaction took
`
`4/7/2015
`
`Eye Care Company Is Being Sold to Valeant NYTimes.com
`
`http://dealbook.nytimes.com/2013/05/27/bauschlombtosellitselftovaleantfor87billion/
`
`2/3
`
`PAGE 2 OF 3
`
`
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`place over the last week, with much of the initial due diligence already
`completed.
`
`Though Valeant’s offer was lower than the valuation that Bausch & Lomb
`would have fetched in an initial offering, it allowed Warburg Pincus to exit its
`investment quickly. Taking the company public would have meant a more
`gradual sale over two to three years.
`
`The transaction is expected to close in the third quarter, pending
`regulatory approval.
`
`Mr. Pearson said that while integrating Bausch & Lomb would take some
`time, Valeant would continue to pursue what he described as smaller “tuckin”
`acquisitions. But dealmaking will remain a core part of the company’s growth
`plans.
`
`“Our strategy is our strategy,” he said. “Our aspiration is to become the
`most valuable pharmaceutical company in the world.”
`
`Valeant was counseled by Skadden, Arps, Slate, Meagher & Flom, and
`Osler, Hoskin & Harcourt. Bausch & Lomb was advised by Goldman Sachs,
`JPMorgan Chase and the law firm Cleary Gottlieb Steen & Hamilton.
`
`A version of this article appears in print on 05/28/2013, on page B2 of the NewYork
`edition with the headline: Eye Care Company Is Being Sold To Valeant.
`
`© 2015 The New York Times Company
`
`4/7/2015
`
`Eye Care Company Is Being Sold to Valeant NYTimes.com
`
`http://dealbook.nytimes.com/2013/05/27/bauschlombtosellitselftovaleantfor87billion/
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`PAGE 3 OF 3
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