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Bausch Health Jumps on Carl Icahn Investment

Carl Icahn acquired 27.8 million shares of Bausch in a purchase that makes him the company's largest single shareholder.
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Shares of Bausch Health  (BHC)  jumped Friday morning after activist investor Carl Icahn disclosed that he has acquired a 27.8 million share interest in the pharmaceutical and medical device maker.

That purchase, disclosed in a regulatory filing on Thursday, makes Icahn Bausch Health's largest shareholder with 7.83% of the company, according to FactSet data.

Bausch responded to Carl Icahn's 13D filing announcing the purchase by stating that it welcomes "open communication with our shareholders and constructive input toward the shared goal of enhancing shareholder value."

Icahn has a reputation for pushing for major changes or even the sale of companies in which he has heavily invested. Icahn called Bausch Health's shares "undervalued" and said he plans to "engage in discussions" with management to find ways to enhance shareholder value. 

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Bausch shares were up 3.89% to $31.28 in morning trading Friday. 

In August last year, Bausch said it planned to spin off its Bausch & Lomb eyecare division into a separate business. 

Bausch said the new group, which will include Bausch Health's global vision care, surgical, consumer and ophthalmic Rx businesses, would likely be reported as a stand-alone division by the first quarter of next year. It generated $4.9 billion in revenue over the course of 2019, the company said.

"We are committed to taking action to unlock what we see as unrecognized value in Bausch Health shares, and we believe that separating our business into two highly-focused, stand-alone companies is the way to accomplish that goal," Chief Executive Joseph Papa said in a statement.

Papa noted that "four years ago, we initiated a multiphase plan, first to stabilize and then to transform Bausch Health into a company positioned to deliver long-term organic growth."