Bausch Health upsizes senior notes offering to $4.4 billion

LAVAL, QC - Bausch Health Companies Inc. (NYSE:BHC)(TSX:BHC), a global pharmaceutical company with annual revenue of $9.6 billion and EBITDA of $3.1 billion, has announced the pricing of its upsized $4.4 billion senior secured notes offering, due 2032. According to InvestingPro data, the company has shown strong revenue growth of 9.91% over the last twelve months. The offering, which was initially set at $4.0 billion, is expected to close on April 8, 2025, subject to customary closing conditions.

The company’s indirect wholly-owned subsidiary, 1261229 B.C. Ltd., will issue the 10.000% notes. Bausch Health also plans to establish new senior secured credit facilities totaling $3.5 billion, comprising a $500 million revolving credit facility and a $3.0 billion term loan facility. The term loan facility was previously anticipated to be $3.4 billion. With total debt standing at $21.8 billion and a current ratio of 0.86, InvestingPro analysis indicates that short-term obligations exceed liquid assets, making this refinancing crucial for the company’s financial structure.

Proceeds from the notes and the new term loan facility will be used to repay Bausch Health’s existing credit agreement, redeem all of its various senior secured notes due between 2025 and 2028, and cover related fees and expenses. The remaining funds will be allocated for general corporate purposes.

The notes will be secured by a first priority lien on substantially all assets of the issuer, including a pledge of a 52.5% equity interest in Bausch + Lomb. They will also be guaranteed by the company and certain subsidiaries that guarantee the company’s existing senior notes. The redemption of the existing notes is contingent on the closing of satisfactory debt financing transactions prior to the redemption dates.

The notes will not be registered under the Securities Act of 1933, as amended, and will be available only to qualified institutional buyers and non-U.S. persons outside the United States. This announcement does not constitute an offer to purchase or a solicitation of an offer to sell any securities.

Bausch Health is known for developing and marketing a range of pharmaceutical products in various therapeutic areas, including gastroenterology, hepatology, neurology, dermatology, dentistry, aesthetics, international pharmaceuticals, and eye health. As a prominent player in the pharmaceuticals industry, analysts are optimistic about the company’s prospects, with InvestingPro data showing that net income is expected to grow this year. For detailed analysis and additional insights, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers, covering this and 1,400+ other top US stocks.

This news is based on a press release statement and contains forward-looking statements subject to risks, uncertainties, and assumptions. The company cautions that these statements are not guarantees of future performance.

In other recent news, Bausch Health Companies Inc. has announced several financial maneuvers aimed at refinancing its existing debt. The company is launching a $4 billion senior notes offering due in 2032 and plans to establish new senior secured credit facilities totaling at least $3.8 billion. These efforts are intended to redeem existing senior secured notes due between 2025 and 2028 and improve the company’s debt maturity profile. S&P Global Ratings has upgraded Bausch Health’s issuer credit rating to ’B-’ from ’CCC+’, acknowledging the company’s partial refinancing of $6.87 billion in secured and unsecured debt. Despite this upgrade, S&P maintains a negative outlook due to risks such as potential generic competition for Xifaxan and uncertainties in Medicare pricing. Analyst Michael Freeman from Raymond James has maintained a Market Perform rating for Bausch Health, highlighting the company’s strategy to manage its high-interest debt. The recent developments in Bausch Health’s financial strategy are part of its broader efforts to strengthen its balance sheet and potentially separate its subsidiary, Bausch + Lomb Corporation.

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