Valeant Pharmaceuticals International, Inc. and Bausch + Lomb Holdings Incorporated entered into a definitive agreement under which Valeant will acquire Bausch + Lomb, a global eye health company, for $8.7 billion in cash. Under terms of the agreement, Valeant will pay aggregate consideration of $8.7 billion in cash, of which approximately $4.5 billion will go to an investor group led by Warburg Pincus and approximately $4.2 billion will be used to repay Bausch + Lomb's outstanding debt. Valeant expects to achieve at least $800 million in annual cost savings by end of 2014.

Bausch + Lomb will retain its name and become a division of Valeant.  Valeant's existing ophthalmology businesses will be integrated into the Bausch + Lomb division, creating a global eye health platform with estimated pro forma 2013 net revenue of more than $3.5 billion. The transaction is expected to close in the third quarter.