Boston Scientific raising $1B as it crawls out of debt

Boston Scientific ($BSX) is in the midst of a painstaking turnaround after months of sliding sales, and now the company is raising more than $1 billion to rectify one of its costliest missteps.

In 2006, Boston Scientific paid about $27 billion to outbid Johnson & Johnson ($JNJ) for rival Guidant, a deal Forbes dubbed "arguably the second-worst ever" that kicked off billions in goodwill-impairment write-downs and hamstrung the company's growth.

Now, with a new CEO and a restructured business, Boston Scientific is selling about $1.1 billion in senior notes to pay down outstanding debt, much of it tied to that unwieldy Guidant buyout. The company is selling debt in two tranches, with $600 million of notes due in 2018 and $450 million more due in 2023.

A broad balance-sheet restructuring is part of CEO Mike Mahoney's plan to reverse Boston Scientific's fortunes over the past few years, an effort that also includes thousands of job cuts and a fair amount of M&A. And while the process has hardly been painless--like that $354 million net loss in the first quarter--the company's acquisitions in electrophysiology and renal denervation have analysts excited about future gains, and technologies like Watchman and Lotus have been posting strong data on the way to regulatory approvals.

Investors have taken notice, too. Boston Scientific's share price has nearly doubled since the start of the year, and while the company's $11.38 Monday opening is paltry compared to its 2004 high of $44, Mahoney has certainly earned the benefit of the doubt as he continues his plan to pare down and refocus the sluggish giant.

- read Boston Scientific's announcement

Editor's note: An earlier version of this story misstated the closing price for Guidant. We regret the error.