Valeant Pharmaceuticals International Inc. agreed to pay $8.7 billion in cash for Bausch & Lomb Holdings Incorporated in a deal announced May 27. The deal capped a successful investment in the contact lens manufacturer for private equity firm Warburg Pincus LLP, which paid $3.7 billion for Bausch & Lomb in 2007. It also served as a consolation prize for Valeant, which earlier this year explored an acquisition of rival generic drug manufacturer Actavis Inc., a deal that might have been worth in excess of $15 billion.
Those talks fell through in late April, and on May 20 Actavis agreed to buy specialty pharmaceuticals company Warner Chilcott plc for $5 billion in stock and $3.5 billion in assumed debt. Valeant moved on quickly as well and would significantly expand its eye care business with the acquisition of Bausch & Lomb. The company's investors led by Warburg Pincus will receive $4.5 billion, and Valeant will also pay down $4.2 billion in Bausch & Lomb debt. New York buyout shop Welsh, Carson, Anderson & Stowe also owns a stake in Bausch & Lomb.
