Valeant Pharma Continues Asset Sales Instead of 'Riskier' Debt Swaps - (TheStreet via NewsPoints Desk)

  • Analysts believe Valeant Pharmaceuticals will continue to offload assets to repay its nearly $29-billion debt load following the completion of the sale of its Dendreon Pharmaceuticals unit for $820 million, TheStreet reported Thursday.

  • Earlier this month, the company agreed to sell its iNova Pharmaceuticals unit for $930 million.

  • "Right now, I think [Valeant] will try to sell more of their business segments if they can get good multiples," remarked BTIG analyst Timothy Chiang, adding "but I don't see a lot of growth in the company if they keep selling assets."

  • "I don't think they will be trading debt for equity, since it's a riskier proposition for investors," Chiang noted, continuing "and investors won't be getting the interest payments they were receiving before."

  • "Pharmaceuticals are all having a hard time," cautioned Chiang, adding "they are not out of the woods yet. No one really knows what will happen next."

  • Conversely, Cantor Fitzgerald & Co. analyst Louise Chen said the company's execution of its stated goals increases confidence that CEO Joe Papa and chief financial officer Paul Herendeen "can return the company back to growth."

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