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LAVAL, QC - Bausch Health Companies Inc. (NYSE:BHC)(TSX:BHC), a global pharmaceutical company with a market capitalization of $2.63 billion and annual revenue of $9.6 billion, has announced its plans to refinance debt through a series of financial transactions. According to InvestingPro data, the company maintains a strong gross profit margin of 71.1%, despite its current debt challenges. The company has issued conditional notices of redemption for all of its outstanding Senior Secured Notes due in 2025, 2027, and 2028. The redemption is contingent upon the completion of satisfactory debt financing transactions.
The company’s recent financing strategy includes the issuance of $4 billion in new senior secured notes due 2032 and securing $3.4 billion under a new 5.5-year senior secured term loan B facility. These steps are intended to satisfy the conditions for the redemption of the existing notes. InvestingPro analysis indicates that the company’s total debt stands at $21.8 billion, with short-term obligations currently exceeding liquid assets, as reflected in its current ratio of 0.86.
The redemption process will be facilitated through the Depository Trust Company, adhering to its applicable procedures. Bausch Health has stated that the obligation to redeem the notes is dependent on the consummation of the financing transactions by the respective redemption dates. The company reserves the right to delay these dates at its discretion if the conditions are not met.
In conjunction with the financing transactions, Bausch Health, or its indirect wholly-owned subsidiary 1375209 B.C. Ltd., plans to discharge the indentures governing the notes, provided the transactions are completed and the notes are redeemed as planned.
Bausch Health specializes in a diverse range of medical fields, including gastroenterology, hepatology, neurology, dermatology, dentistry, aesthetics, international pharmaceuticals, and eye health, with a controlling interest in Bausch + Lomb Corporation.
The company’s press release includes forward-looking statements and acknowledges that there can be no assurance regarding the terms, timelines, or successful completion of the proposed financial restructuring and debt redemption.
This news is based on a press release statement and provides an overview of Bausch Health’s current financial strategy as it seeks to manage its debt and refinance through new financial arrangements. While the company wasn’t profitable in the last twelve months, InvestingPro data shows that analysts expect profitability this year, with three analysts recently revising their earnings estimates upward. For deeper insights into Bausch Health’s financial health and detailed analysis, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Bausch Health Companies Inc. reported a strong financial performance with seven consecutive quarters of revenue growth, significantly driven by Xifaxan’s double-digit percent expansion. The company generated $1.3 billion in free operating cash flow in 2024, resulting in a decrease in adjusted leverage to 6.4x from 7.5x in 2023. Additionally, Bausch Health has launched a $4 billion senior notes offering and plans to establish new senior secured credit facilities totaling at least $3.8 billion. This initiative is part of the company’s strategy to refinance its debt and improve its debt maturity profile, with J.P. Morgan assisting in these financing goals.
S&P Global Ratings upgraded Bausch Health’s credit rating from ’CCC+’ to ’B-’, citing the company’s partial refinancing of $6.87 billion in secured and unsecured debt. Despite the upgrade, S&P maintains a negative outlook due to potential risks such as an earlier-than-expected generic launch for Xifaxan and significant Medicare price reductions in 2027. Raymond James analyst Michael Freeman maintained a Market Perform rating on Bausch Health, noting the company’s efforts to pay down short-term, high-interest debt as a positive move for financial flexibility. The potential separation of Bausch + Lomb remains a key factor in Bausch Health’s future strategy, with proceeds possibly used to reduce the company’s sizable debt.
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