ROCHESTER, N.Y. (AP) - Private equity firm Warburg Pincus said Friday it has
completed its $3.67 billion buyout of troubled eye care products maker Bausch &
Lomb Inc.
"We look forward to helping the company build upon its rich heritage and
premier brand in ophthalmology," said Elizabeth Weatherman, a managing director
at Warburg Pincus, a buyout and venture capital firm in New York.
Bausch & Lomb's board agreed to a $65-a-share buyout in May, prompting an
unsolicited counter bid by rival Advanced Medical Optics Inc. But Santa Ana,
Calif.-based Advanced Medical withdrew its $4.2 billion cash-and-stock offer in
August, saying Bausch & Lomb had put up unrealistic hurdles to a potential deal.
In September, shareholders representing more than two-thirds of Bausch &
Lomb stock voted in favor of the takeover. Warburg Pincus also assumed about
$830 million of debt.
"With a strong and supportive partner in Warburg Pincus, we are
well-positioned to create new opportunities for Bausch & Lomb and advance our
leadership in the eye health industry," Bausch & Lomb's chief executive, Ronald
Zarrella, said in a statement.
Zarrella told reporters last month that the deal allows Bausch & Lomb "to
pursue the growth path we were on ... without a lot of outside distraction."
Warburg Pincus' owners, he added, "think we can make a comeback from the
difficulties of last year." Bausch & Lomb stock ceased trading on the New York
Stock Exchange at market close Friday and will be delisted. Its stock, which has
bounced between $47.36 to $77 over the last year, closed unchanged at $64.98
Friday.
The 154-year-old company, which makes contact lenses, ophthalmic drugs and
vision-correction surgical instruments, was rocked in May 2006 by the worldwide
recall of a lens solution blamed for a flurry of potentially blinding fungal
infections. In a regulatory filing Monday, the company said it has been named as
a defendant in more than 550 product-liability lawsuits stemming from the
recall.
Federal regulators called the $100 million-a-year ReNu with MoistureLoc
multipurpose cleaner the "potential root cause" of an outbreak of Fusarium
keratitis infections in the United States, Asia and other parts of the world.
Zarrella, who took the helm at Bausch & Lomb in 2001, holds options for 1.1
million shares. With the buyout, he earns $29.2 million and is entitled to an
extra $10.1 million payout if his job is terminated "without cause," regulatory
filings show.
The company, which employs 13,000 and posted $2.3 billion in sales last
year, has been publicly traded for 69 years and could return to public ownership
within the next five to seven years, Zarrella said.
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