Valeant crushed as short-seller’s report alleges fraud; Jarden prices; Globo postpones

By Paul Deckelman and Paul A. Harris

New York, Oct. 21 – Jarden Corp. came to market on Wednesday with a $300 million offering of eight-year notes, which priced at par and then moved up by nearly 2 points.

But the big news of the day came out of the secondary sphere, where Valeant Pharmaceuticals International Inc.’s already beleaguered bonds swooned in heavy trading, in line with a plunge in its equity, after a report by a trading firm that specializes in selling short against target companies alleged that the Canadian drug manufacturer was using Enron-style accounting tricks to artificially and fraudulently swell its revenues, a charge that Valeant denied.

Valeant’s troubles, along with recent political criticism of the drug industry, caused other biotechnology and pharmaceutical credits to fall, including Endo International plc and Mallinckrodt plc.

Those drug sector woes also knocked Concordia Healthcare Corp.’s new eight-year notes lower for a second consecutive day. The latter company’s deal had priced on Tuesday and then immediately traded down sharply.

The junk primary meantime heard that Globo plc had shelved its long-planned $180 million offering of five-year secured paper, citing unfavorable market conditions.

American Energy – Permian Basin, LLC remains in the market with a $560 million offering of five-year secured paper.

Statistical measures of junk market performance were mixed for a second consecutive session on Wednesday, having turned mixed on Tuesday after having been higher across the board Friday and then again on Monday.

© 2015 Prospect News.
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