US eye care firm Bausch & Lomb files for IPO

23 Mar 2013

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Private equity firm Warburg Pincus owned eye care company Bausch & Lomb Inc is once again going public and has filed documents to raise up to $100 million in an initial public offering.

Bausch & Lomb is seeking to raise up to $100 million, but that amount is a placeholder and may later change.

Bausch & Lomb did not reveal the number of shares to be offered and the price range for the proposed IPO, but said in the filing that Warburg Pincus would continue to own a majority of the stock after the offering.

In December 2012, Bloomberg reported that Warburg Pincus has hired Goldman Sachs to explore a sale of Bausch & Lomb and was expecting more than $10 billion. (See: Warburg Pincus seeks $10 bn plus for eye care company Bausch & Lomb)

Warburg Pincus could also turn to an IPO as an alternative if a buyer cannot be found, the report had added.

But after having approached health-care companies such as French drug giant Sanofi, UK-based GlaxoSmithKline, US-based Merck & Co and Abbott Laboratories, Warburg Pincus decided on an IPO after all the private bids fell far short of its expectations, according to some media reports.

Warburg Pincus had taken Bausch & Lomb private in 2007 for $3.7 billion. The total deal size was $4.6 billion including debt.

Founded in 1853 by two German immigrants, John Jacob Bausch, a trained optician and Henry Lomb, who put in the finance, Bausch & Lomb is one of the world's leading suppliers of eye health products, such as contact lenses and lens care products.

The Rochester, New York-based company, which competes with Johnson & Johnson, Alcon, Allergan, MSD-Chibret and Ciba Vision, is also one of the oldest continually operating companies in the US.

Earlier, it also produced photographic lenses, spectacle lenses, microtomes, binoculars and telescopes, optical lenses, eyeglasses,, microscopes, binoculars, projectors, camera lenses, camera diaphragms, and also produced the lenses for cameras which captured the first satellite images of the Moon.

Its biggest blunder was selling the popular Ray-Ban brand of sunglasses in 1999 to Italy's Luxottica Group.

In 2007, eye products maker Advanced Medical Optics (AMO) had made a $75 per share or $4.3 billion bid for Busch & Lomb, but had to withdraw after opposition from its largest shareholder, ValueAct Capital, which held 14.7-per cent stake in AMO.

After going private, the company was hit hard by a recall of its ReNu with MoistureLoc contact lens solution due to fungal infections. Bausch & Lomb paid about $250 million to settle 600-plus lawsuits linked to the infection known as Fusarium keratitis.

In March 2010, Warburg Pincus hired Fred Hassan, former chairman and CEO of Schering-Plough, as the new chairman of Bausch & Lomb, and Brent Saunders, former president of Global Consumer Health at Schering-Plough, as the new CEO.

Hassan is known for deal making in the health-care industry. He was the prime mover in the 2000 acquisition of Monsanto Co by Pharmacia & Upjohn for $37 billion, and three years later sold Pharmacia to drug giant Pfizer for $58 billion.

He was also heading Schering-Plough when it was sold to Merck for $41 billion in 2009.

Since joining Bausch & Lomb, Hassan has expanded the company through acquisitions. He was the architect of two deals done last year, which includes Germany's eye laser firm Technolas Perfect Vision GmbH and Ista Pharmaceuticals, the third-largest branded prescription eye care company in the US.

Bausch & Lomb posted a net loss of $68.3 million in 2012 on revenue of $3.04 billion. It had a loss of $123.9 million on revenue of $2.85 billion in 2011.

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