8-K: Bausch + Lomb Upsizes Senior Secured Notes and Term Loan Offerings to Fund Debt Refinancing

Bausch + Lomb Corporation announced the pricing of an upsized $675 million senior secured floating rate notes offering and an increased $2.325 billion new term B loan facility, intended to refinance existing debt and enhance financial flexibility.

Summary

• Bausch + Lomb Corporation's subsidiaries, Bausch & Lomb Incorporated and Bausch+Lomb Netherlands B.V., priced an offering of $675 million aggregate principal amount of senior secured floating rate notes due 2031.
• The size of the notes offering was increased from the previously announced $600 million.
• The notes will be sold to investors at a price of 99.500% of the principal amount.
• The company is also seeking to partially refinance its credit agreement, intending to obtain a new $2.325 billion term B loan facility and a new $800 million revolving credit facility.
• The allocated size of the new term B loan facility was increased from the previously announced $2.2 billion.
• The new term B loan is expected to accrue interest at a rate of Term SOFR + 4.25% per annum.
• Net proceeds from the notes offering and the new term B loan facility will be used to repay outstanding borrowings under the existing revolving credit facility, refinance outstanding term A loans due 2027 and term B loans due 2027, and cover related fees and expenses.
• The closing of the notes offering is not contingent upon the closing of the new term B loan facility or the new revolving credit facility.
• The notes will be guaranteed by the company and its subsidiaries (excluding the Issuers) that are guarantors under the company's credit agreement.
• The notes will be secured on a first priority basis by liens on the same assets that secure obligations under the company's credit agreement and its 8.375% senior secured notes due 2028.
• Closing for both the notes offering and the new loan facilities is expected to occur on June 26, 2025, subject to customary closing conditions.

Sentiment

Score: 8

Explanation: The successful upsizing of both the notes offering and the term loan facility indicates strong market confidence in Bausch + Lomb's creditworthiness and financial stability. This strategic refinancing improves the company's debt maturity profile and financial flexibility, which is a positive development.

Positives

• The company successfully upsized its senior secured notes offering from $600 million to $675 million, indicating strong market demand.
• The new term B loan facility was also increased from $2.2 billion to $2.325 billion, further demonstrating market confidence.
• The refinancing strategy aims to repay existing debt, including term A and term B loans due 2027, which should improve the company's debt maturity profile and financial flexibility.

Risks

• There can be no assurances that the company will be able to complete the New Term B Loan Facility and/or New Revolving Credit Facility transactions on the terms described or at all.
• The Notes have not been and will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States except pursuant to an exemption from registration requirements.

Future Outlook

The company expects to close the $675 million senior secured notes offering, the $2.325 billion new term B loan facility, and the $800 million new revolving credit facility on June 26, 2025. The net proceeds from the notes and new term B loan are intended to fully repay outstanding borrowings under the existing revolving credit facility and refinance outstanding term A and term B loans due 2027, along with related fees and expenses.

Management Comments

• The company intends to use the net proceeds from the Notes offering and the New Term B Loan Facility to repay in full the outstanding borrowings under its existing revolving credit facility, to refinance in full its outstanding term A loans due 2027 and term B loans due 2027 and to pay related fees and expenses.

Industry Context

This announcement pertains to Bausch + Lomb's corporate financing strategy within the global eye health industry. It reflects the company's efforts to optimize its capital structure and manage debt maturities, a common practice for large, publicly traded companies in mature industries.

Stakeholder Impact

• Shareholders: The refinancing could lead to a more stable capital structure and potentially lower interest expenses over time, positively impacting future earnings.
• Creditors: Existing creditors will have their loans repaid, while new creditors will hold the newly issued notes and loan facilities, secured by company assets.

Next Steps

• Closing of the $675 million senior secured notes offering, expected on June 26, 2025.
• Closing of the $2.325 billion new term B loan facility and $800 million new revolving credit facility, also expected on June 26, 2025.

Key Dates

Keywords

Bausch + Lomb, BLCO, Debt Offering, Refinancing, Senior Secured Notes, Term Loan Facility, Revolving Credit Facility, Corporate Finance, Eye Health, SEC Filing