Valeant kicks off $5.55 billion; Fortescue meeting Friday; funds see $196 million outflows

By Paul A. Harris

Portland, Ore., March 5 – Bank loans were pretty well bid on Thursday, according to a trader.

“Things had been pretty much all one way,” said the trader.

“But this week and last week we went away from all one-way to a more two-way market, with people taking profits and adjusting portfolios.

“The primary market is picking up,” the trader added, “but we're not seeing a lot of huge deals yet.”

Dedicated bank loan funds saw $196 million of outflows for the week to Wednesday's close.

Outflows have been the story, the trader said but added that lately the negative flows seem to be slowing to a halt.

In the new issue market, Valeant Pharmaceuticals International Inc. set a Monday bank meeting for $5.55 billion of incremental term loan debt (Ba1/BB), according to a market source.

The term loan debt is split between a $1 billion incremental five-year term loan A and a $4.55 billion seven-year incremental term loan B.

Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., Bank of Tokyo-Mitsubishi UFJ Ltd., DNB Markets Inc. and SunTrust Robinson Humphrey Inc. are the joint lead arrangers and bookrunners.

Pricing remains to be determined.

Proceeds, along with proceeds from $9.6 billion of senior notes, will be used to fund the acquisition of Salix Pharmaceuticals Ltd.

And Fortescue Metals Group set a bank meeting Friday morning to roll out about $7.39 billion of bank loan debt.

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