2.2.0.7 false Merger with Biovail 0220 - Disclosure - Merger with Biovail true false false false 1 USD false false USD Standard http://www.xbrl.org/2003/iso4217 USD iso4217 0 USDEPS Divide http://www.xbrl.org/2003/iso4217 USD iso4217 http://www.xbrl.org/2003/instance shares xbrli 0 Shares Standard http://www.xbrl.org/2003/instance shares xbrli 0 $ 2 Merger with Biovail [Abstract] 0 vrx_MergerWithCompanyAbstract vrx false na duration Merger with Company. false false false false false true false false false false false false 1 false false false false 0 0 false false false xbrli:stringItemType string Merger with Company. false 3 Merger with Biovail 1 vrx_MergerWithCompanyTextBlock vrx false na duration Merger with Company. false false false false false false false false false false false verboselabel false 1 false false false false 0 0   <div style="font-family: 'Times New Roman',Times,serif; margin-left: 0%"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>20. Merger with Biovail</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">On June 20, 2010, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Biovail, BAC and Merger Sub. Pursuant to the Merger Agreement, Merger Sub will merge with and into Valeant with Valeant continuing as the surviving corporation. On the date of the closing of the merger, Biovail will change its name to Valeant Pharmaceuticals International, Inc. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">We intend to pay, on the business day immediately preceding the effective time of the merger, a special dividend of $16.77 per share of our common stock to Valeant stockholders of record as of the close of business on such day (the “Pre-Merger Special Dividend”). If the merger is completed, each share of our common stock issued and outstanding immediately prior to the completion of the merger, other than shares owned by Valeant, Biovail, BAC or Merger Sub (all of which will be cancelled), and other than those shares with respect to which appraisal rights are properly exercised under Delaware law and not withdrawn, will be converted into the right to receive 1.7809 Biovail common shares. In addition, our then outstanding convertible notes, if not converted prior to the date of the closing of the merger, and warrants issued pursuant to an Exchange Agreement in August 2009, if not exercised or expired prior to the date of the closing of the merger, will become convertible into, or exercisable for, Biovail common shares. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">The completion of the merger is subject to the approval of our stockholders and Biovail shareholders and consummation of the financing, the terms of which are set forth in the Commitment Letter (as defined below), or alternative financing. In addition, the merger is subject to other customary closing conditions and regulatory approvals, including, among others, (i) the declaration by the SEC of the effectiveness of the Registration Statement on Form S-4 filed with the SEC by Biovail on July 21, 2010 and the approval of the listing on the Toronto Stock Exchange and the New York Stock Exchange of the common shares of the combined company to be issued in connection with the merger; (ii) the payment of the Pre-Merger Special Dividend and (iii) receipt by each party of an opinion of counsel stating that the merger (1) should qualify for U.S. Federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code (the “Code”) and (2) U.S. holders of our common stock should not recognize gain under Section 367(a) of the Code on the exchange of their Valeant common stock for Biovail common shares in the merger. On July 22, 2010, the Federal Trade Commission announced the grant of early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, with respect to the proposed merger contemplated by the Merger Agreement. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">Valeant and Biovail have entered into a commitment letter (the “Commitment Letter”), dated as of June 20, 2010, with Goldman Sachs Bank USA, Goldman Sachs Lending Partners LLC, Jefferies Group, Inc. and Morgan Stanley Senior Funding, Inc. (such financial institutions being referred to as the “Commitment Parties”), pursuant to which the Commitment Parties have committed to provide up to $3.022 billion in loans for the purposes of (1) refinancing our Senior Secured Term Loan, 8.375% Senior Notes and 7.625% Senior Notes, (2) funding the Pre-Merger Special Dividend and certain expenses incurred in connection with the merger, (3) providing post-closing liquidity to the combined company and (4) funding a post-merger special dividend of $1.00 per common share of the combined company anticipated to be paid on December 31, 2010, or on such other date as the board of directors of the combined company may determine, subject to the discretion of the board of directors of the combined company and to compliance with applicable law (the “Post-Merger Special Dividend”). </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">The Commitment Letter provides for the following facilities: </div> <div style="margin-top: 6pt"> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left"> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="6%" style="background: transparent"> </td> <td width="3%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td>Revolver: $250 million under a senior secured revolving credit facility;</td> </tr> <tr> <td style="font-size: 6pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="4%" style="background: transparent"> </td> <td width="3%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td>Term Loan A: $500 million under a senior secured term loan facility; and</td> </tr> <tr> <td style="font-size: 6pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="4%" style="background: transparent"> </td> <td width="3%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td>Term Loan B: up to $2.272 billion under a senior secured term loan facility ($300 million of which is a delayed draw directly linked to the payment of the Post-Merger Special Dividend.</td> </tr> </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">The financing commitments of the Commitment Parties are subject to various conditions set forth in the Commitment Letter. It is expected that Valeant, Biovail and the Commitment Parties will enter into definitive loan documents with respect to the financing as contemplated by the Commitment Letter prior to the closing of the merger. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; text-indent: 4%">In connection with the proposed refinancing of our 8.375% Senior Notes and 7.625% Senior Notes, we expect to incur prepayment penalties aggregating approximately $160.0 million. The Merger Agreement contains specified termination rights for each of us and Biovail and further provides that, upon termination of the Merger Agreement by Biovail or us under certain circumstances, the terminating party may be obligated to pay the other party a termination fee of $100.0 million. </div> </div>  <!-- Begin Block Tagged Note false false false us-types:textBlockItemType textblock Merger with Company. No authoritative reference available. false 1 2 false UnKnown UnKnown UnKnown false true