Wall Street Junk Euphoria Backs Ackman’s Allergan Dreams

While hedge-fund manager Bill Ackman has repeatedly failed to persuade Allergan Inc. to sell itself, that hasn’t stopped Wall Street bankers from lining up to fund a potential deal with more than $20 billion of junk debt.

Banks including Barclays Plc and Royal Bank of Canada raised loan commitments to $8 billion from $7 billion and pledged to arrange $12.4 billion of high-yield bonds to finance Valeant Pharmaceuticals International Inc.’s unsolicited $54 billion bid, a filing showed yesterday. The bank debt includes a $5 billion term loan, which would be the biggest of its kind backing a takeover this year, data compiled by Bloomberg show.