Sometimes complex business transactions take jobs from New Jersey, and other times, the state benefits. Recently, Valeant Pharmaceuticals International announced that it will be moving ophthalmology company Bausch + Lomb’s headquarters from Rochester, New York to New Jersey once Valeant’s acquisition of the company is complete.
Valeant’s acquisition of Bausch + Lomb was announced in May. Under the terms of the agreement, Valeant will be paying $8.7 billion for the company — $4.2 billion to pay off Bausch + Lomb’s debts and an additional $4.5 billion to the investment firm that currently owns Bausch + Lomb. The merger will be completed after the company receives regulatory approval which it expects by next month.
As a result of the acquisition, Valeant expects increased profits as it moves into ophthalmology field. The company expects increased demands for contacts and other ophthalmology services as the United States’ population ages.
In addition to the change in headquarters, Valeant has also announced that following the merger it will cut between 10 and 15 percent of its workforce as the company’s businesses are combined into a single unit. These cuts will total between 1,850 and 2,775 employees and will come from both Bausch + Lomb’s and Valeant’s employees. Despite the layoffs, Valeant intends to keep all of Bausch + Lomb’s manufacturing facilities open. With these changes, the company is projecting an annual savings of at least $800 million.
Publicly traded mergers and acquisitions, such as this one, are massive undertakings. These complex business transactions require skilled planning and foresight. Even when these transactions receive all the regulatory approvals, there are still many internal issues that need to be worked out for the two companies to become one entity — as can been seen by Valeant’s recent announcements. If these issues are not properly handled properly, then the results can be devastating for the new company.
Source: Courier-Post, “Bausch + Lomb HQ will move to N.J.,” July 29, 2013