On June 7, 2016, Canada-based Valeant Pharmaceuticals International Inc.'s new CEO revised revenue and EBITDA guidance lower to levels materially below our expectations. We now estimate adjusted debt leverage will be about 6.2x for 2016 and 5.2x for 2017, above our previous estimate of about 5.4x for 2016 and 4.7x for 2017. Moreover, although the company expects to meet financial covenants through 2016 even with the lowered guidance, we expect the cushion on these covenants will be thin and that absent material asset sales and debt reduction it may need to seek covenant waivers in 2017 when the interest coverage covenant steps up to 3.0x. We are affirming our 'B' corporate credit and 'BB-' senior secured debt ratings and removing
