L'Oreal to pay $1.3B for Valeant skin-care brands

PARIS-- L'Oréal SA plans to buy CeraVe and two other skin-care brands (AcneFree and Ambi) from Valeant Pharmaceuticals Inc. for $1.3 billion, expanding the French cosmetics firm's U.S. presence and deepening its portfolio in a product segment that has become the beauty industry's largest.

• Earlier in the day, Valeant said it would sell its Dendreon Pharmaceuticals unit to closely held Chinese conglomerate Sanpower Group Co. for about $820 million.
• The agreements mark a start to Valeant's efforts to pay down about $30 billion in debt. The Laval, Quebec-based company has been embroiled in scandals about its drugs' high prices and accounting that led to legal and regulatory investigations along with declines in its share price. 
• The three brands have combined annual sales of about $168 million and will become part of L'Oreal's Active Cosmetics Division, alongside La Roche-Posay, Vichy and SkinCeuticals.
• Through Monday, 9 Jan 2017, Valeant's U.S. shares had plunged 94 percent from their 2015 peak, cutting the company's market value to $5.2 billion.

The all-cash deal will give L'Oréal the CeraVe brand, which includes cleansers, moisturizers and healing ointments, as well as the AcneFree and Ambi brands, which distribute a range of acne treatments and skin-care products.

L'Oréal, one of the world's leading cosmetics makers, said the three brands have an annualized combined revenue of around $168 million.

CeraVe offers a range of skin-care products including cleansers, moisturizers and sunscreens, as well as a baby line. It is one of the fastest-growing skin-care brands in the U.S., averaging 20% annual growth over the past two years, L'Oréal said.

L'Oréal said the three brands would stand alongside the likes of Vichy, La Roche-Posay and SkinCeuticals in its Active Cosmetics division, which has been growing in recent quarters, boosted by strong performances in North America and Latin America.

For Valeant, the sale is part of new Valeant Chief Executive Joseph Papa's efforts to focus the company on its key franchises by selling noncore assets or milking them for cash to pay down $30 billion in debt.

American Capital (ACAS) sells itself to 2 companies

American Capital (NASDAQ: ACAS) is soon to be no more. The company has agreed to sell its assets to a pair of peers, fellow BDC Ares Capital (NASDAQ: ARCC) and real estate investment trust American Capital Agency (NASDAQ: AGNC).

The bulk of American Capital will go to Ares Capital in a deal worth a total of nearly $3.2 billion. American Capital stockholders will be given $6.41 per share and just over 0.48 of an Ares Capital share for each share they own. After the transaction closes, current Ares Capital shareholders will own around 74% of the merged entity, with present American Capital investors holding the remainder.

Additionally, Ares Capital's external manager, Ares Management, is to pay $1.20 per share to American Capital shareholders at closing. All told, that contribution will total approximately $275 million. The bulked-up Ares Capital will retain Ares Management as its external manager.

The remainder of American Capital, specifically its business unit, American Capital Mortgage Management, is to be sold to American Capital Agency. That business currently functions as the external manager of American Capital Agency, so the deal will essentially bring that management in-house. American Capital Agency will pay $562 million, or $2.45 per American Capital share, for the unit.

American Capital shareholders will receive a total of $17.40 in cash and Ares Capital stock in the deal. That's around 11% higher than the company's closing stock price at the end of last week, and totals over $4 billion.