Valeant Pharmaceuticals Intl Inc (NYSE: VRX) is having an overwhelmingly strong start to the trading session this morning, and for good reason. The company announced that sale of its iNova Pharmaceuticals business, causing excitement among investors who sent the stock upward. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (10:00), VRX is trading at $13.11 per share after a again of $0.94 per share or 7.72% thus far today.
VRX Gains On iNova Pharmaceuticals Sale
As mentioned above, Valeant Pharmaceuticals is having a great day in the market today after announcing the sale of its wholly-owned subsidiary, iNova Pharmaceuticals. The sale has been made to a company jointly owned by funds advised and managed by Pacific Equity Partners and The Carlyle Group. The total price of the sale comes to $930 million.
In a press release, VRX said that it intends on using the proceeds from the sale of iNova to permanently repay term loan debt under its Senior Secured Credit Facility. It is expected that the transaction will come to a close in the second half of 2017. However, as always, it is subject to customary closing conditions and receipt of applicable regulatory approvals. In a statement, Joseph C. Papa, Chairman and CEO at VRX, had the following to offer…
“The sale of iNova is part of the company’s ongoing efforts to both simplify our operating model and strengthen our balance sheet…. We will continue to evaluate opportunities that will enable us to deliver on our commitments and unlock value for shareholders.”
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on VRX. In particular, we’ll be following this transaction to ensure that it doesn’t hit any roadblocks along the way. We’re also interested in following the continued plan of the company to pay off debt, a plan that seems to be working thus far. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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