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UPDATE 2-Valeant to sell assets for $2.12 bln to ease debt load

Published 2017-01-10, 07:20 a/m
© Reuters.  UPDATE 2-Valeant to sell assets for $2.12 bln to ease debt load
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Jan 10 (Reuters) - Valeant Pharmaceuticals (NYSE:VRX) International VRX.TO is selling its Dendreon cancer business and three skincare brands for about $2.12 billion as the troubled Canadian drugmaker looks to pay down its more than $30 billion debt.

Valeant's U.S.-listed shares rose 15 percent to $17.65 in premarket trading on Tuesday.

The company is trying to regain investor confidence after its stock declined nearly 90 percent in the past year over disclosures that it secretly worked with a specialty pharmacy to boost sales of its medicines.

Laval, Quebec-based Valeant is the subject of a number of recent investigations related to specialty pharmacy, including by congressional panels and the U.S. Securities and Commission.

French cosmetics group L'Oreal OREP.PA is buying CeraVe, AcneFree and Ambi from Valeant for about $1.3 billion in cash. is also selling its Dendreon unit to China's Sanpower Group Co Ltd SPGCL.UL for $819.9 million.

Valeant bought bankrupt Dendreon in 2015 for about $300 million. this sale, we are better aligning our product portfolio with Valeant's new operating strategy by exiting the urological oncology business, which is one of our non-core assets," Valeant Chief Executive Joseph Papa said in a statement on Monday.

The deals could be the first of a series of divestitures for Valeant, whose growth was fueled by an acquisition spree that left it saddled with a huge pile of debt.

Mizuho Securities USA analyst Irina Koffler said she also expects Valeant to divest its dental business as well as its interests in some geographies.

Founded in 2005, CeraVe develops cleansers, moisturizers and baby products and is one of the fastest-growing active skin care brands in the United States, L'Oreal said.

AcneFree provides acne treatments and skin cleansers, while Ambi makes products to treat dark spots and brighten skin.

L'Oreal said the three brands would stand alongside the likes of Vichy and La Roche-Posay in its Active Cosmetics division, which is among its strongest in terms of growth and resilience to slowdowns in consumer spending in the past three to four years.

L'Oreal paid nearly eight times the brand's combined annual revenue of $168 million as it expands into one of the fastest growing areas of the beauty industry.

Separately, Valeant said its lotion for plaque psoriasis, IDP-118, which is a combination formulation of two common treatments - halobetasol propionate and tazarotene - was more effective and reduced irritation in patients in a key study.

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