Bausch + Lomb Eyes $100 Million Initial Public Offering With New S&P 500 Peak In Sight

As the S&P 500 (INDEXSP:.INX) equity-market index homes in on its all-time high of 1,576.09, Bausch + Lomb, through its holding company WP Prism, filed a Form S-1 registration statement with the U.S. Securities and Exchange Commission Friday in anticipation of its initial public offering of common stock.

Neither the number of shares to be offered nor their price range has been determined yet, Bausch + Lomb said in a statement. However, the eye-health company's Form S-1 indicated it will be seeking about $100 million via the IPO. Of course, this figure could climb -- a little or a lot -- depending on financial-market conditions.

Units of the Bank of America Corp. (NYSE:BAC), Citigroup Inc. (NYSE:C) and JPMorgan Chase & Co. (NYSE:JPM) are the lead underwriters, as anticipated by multiple media outlets this month.

Founded in 1853, Bausch + Lomb is based in Rochester, N.Y. It employs more than 11,000 people around the world who work in three business units focused on enhancing, protecting and restoring people’s eyesight: pharmaceuticals, surgical and vision care. Encompassing ophthalmic pharmaceuticals, ophthalmic surgical devices and instruments, and contact lenses and lens-care offerings, the products the company develops, manufactures and markets are available in more than 100 countries.

According to its Form S-1, Bausch + Lomb during the year ended Dec. 29 generated net sales of $3.0 billion, a net loss of $68.3 million and adjusted earnings before interest, taxes, depreciation and amortization of $643.1 million. Over the two years ended the same date, the company said it generated net sales growth at a compound annual growth rate of 9 percent and adjusted EBITDA growth at a CAGR of 17 percent.

"The global eye health market is large, dynamic and growing," Bausch + Lomb contended in its filing. "A leading independent consulting firm estimates that this market will grow from $36 billion of sales in 2011 to more than $48 billion of sales in 2017, at a [CAGR] of approximately 5%."

The company also elaborated on this estimate's foundation: "We believe growth will be driven by multiple factors and trends, including an aging global population; the rapid growth of the middle class in emerging markets; the increasing global prevalence of diabetes, which has a strong correlation with severe ocular conditions; advancements in technology and innovation, which create opportunity to address previously undertreated conditions; and the resilience of the eye-health market to volatility and government reimbursement pressures."

Bausch + Lomb entered 2007 as a publicly traded company and exited it as a privately held one. In October of that year, the then-troubled firm was acquired for about $4.5 billion by funds associated with the private-equity player Warburg Pincus LLC.

Warburg Pincus (and its affiliates) and Welsh, Carson, Anderson & Stowe (and its affiliate) will be the principal and selling stockholders in Bausch + Lomb with 87.1 percent and 11.1 percent of the shares, respectively, according to the company's Form S-1.

Bausch + Lomb's owners may -- or may not -- have timed the company's IPO well.

"When the markets are good, it’s a good time to bring IPOs," Tim Cunningham, who helps oversee $88 billion as a managing director and portfolio manager at Thornburg Investment Management in Santa Fe, N.M., told Bloomberg News. "We’ve been in a really big rally, and in these kinds of markets, you tend to see more deals. It wouldn’t surprise me if we had a bunch more coming in the next few weeks."

True enough. To anyone who looks at the financial multiverse through anything other than rose-colored glasses, though, the juxtaposition of an anticipated all-time high in the S&P 500 and the expected annual spring swoon in the stock market makes the picture seem more dark than light.

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