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Valeant High Yield Bonds Climb in Secondary on Debt Paydown News via iNova

Valeant Pharmaceuticals 6.125% notes due 2025 were the most active early movers on Thursday, climbing half a point, to 80.875, according to MarketAxess, after the debt-laden drug maker announced its sale of iNova Pharmaceuticals for $930 million, with proceeds slated to pay down a portion of Valeant’s term debt.

Asset sales have been a primary focus among creditors to the Laval, Quebec–based drug maker, which has been scrambling to shore up cash in order to pay down its substantial debt load, which totaled more than $28 billion as of March 31, according to Valeant’s quarterly filing with the Securities and Exchange Commission.

Meanwhile, the issuer’s Series F term loan (L+475, 0.75% LIBOR floor) was at a 101.5 bid today, down about an eighth of a point on the day, sources said. The paper was bracketing 102 at the start of this week, a record high for the loan. As of March 31, there was $6.83 billion outstanding on the loan, SEC filings show.

Shares of Valeant (NYSE: VRX) were also up roughly 8% in morning trading.

The iNova subsidiary has been sold to a company jointly owned by funds advised and managed by Pacific Equity Partners and the Carlyle Group, according to a company release. The transaction is expected to close in the second half of the year, subject to customary regulatory approvals.

Goldman Sachs acted as financial adviser to Valeant in the sale, and Baker McKenzie served as legal adviser.

iNova manages over-the-counter prescriptions, in areas including weight management, pain relief, cardiology and cold and cough products.

Valeant Pharmaceuticals is a specialty pharmaceutical company — James Passeri/Kelsey Butler

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This story is taken from analysis which first appeared on www.lcdcomps.com, an offering of S&P Global Market Intelligence. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.

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