Salix Pharmaceuticals in $690 Million Convertible Senior Notes Offering

Cleary Gottlieb represented the initial purchasers, led by Merrill Lynch, in a recent convertible senior debt offering by Salix Pharmaceuticals. Salix Pharmaceuticals issued $690 million of 1.5% Convertible Senior Notes due 2019. Cleary Gottlieb also represented Bank of America and Royal Bank of Canada as the counterparties to Salix in convertible note hedge and warrant transactions hedging Salix’s obligations relating to the notes. The offering (including full exercise of the related over-allotment option) closed on March 16, 2012.

Salix, based in Raleigh, North Carolina, is a specialty pharmaceutical company that develops and markets prescription pharmaceutical products for the treatment of gastrointestinal diseases. Salix’s strategy is to in–license late–stage or marketed proprietary therapeutic drugs, complete any required development and regulatory submission of these products and market them through the Company’s gastroenterology specialty sales and marketing team. Cleary Gottlieb previously represented the underwriters and counterparties in a convertible bond offering and capped call transaction by Salix in 2010, as well as the initial purchasers in a convertible bond offering by Salix in 2008.