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InterMune, Inc. (ITMN) Announces Pricing of Concurrent Public Offerings of $105,000,000 Principal Amount of Convertible Senior Notes and 13,500,000 Shares of Common Stock


1/16/2013 9:05:54 AM

BRISBANE, Calif., Jan. 16, 2013 /PRNewswire/ -- InterMune, Inc. (Nasdaq: ITMN) today announced that it has agreed to sell an aggregate of $105,000,000 principal amount of its 2.50% convertible senior notes due 2017 and 13,500,000 shares of its common stock at a price to the public of $9.90 per share in concurrent underwritten public offerings. InterMune has granted the underwriters 30-day options to purchase up to an additional $15,750,000 aggregate principal amount of convertible senior notes and up to an additional 2,025,000 shares of common stock in connection with the offerings. InterMune estimates aggregate net proceeds from the concurrent offerings to be approximately $228.1 million (assuming no exercise of the underwriters' options to purchase additional convertible senior notes and shares of common stock), after deducting underwriting discounts and commissions and estimated offering expenses. InterMune currently intends to use the net proceeds from the offerings to repay at maturity or earlier repurchase its outstanding 5.00% convertible senior notes due 2015. The Company currently has received commitments from certain holders of the outstanding 5.00% convertible senior notes to allow the Company to repurchase approximately $50 million of the 2015 notes. Proceeds from the offerings may also be used to fund the commercialization of EsbrietĀ® (pirfenidone), to fund InterMune's ASCEND trial and for general corporate purposes, which may include funding research and development, and working capital. InterMune may also use a portion of the net proceeds for capital expenditures or for acquisitions or investments in complementary businesses, products and technologies.

(Logo: http://photos.prnewswire.com/prnh/20120827/SF62570LOGO)

The convertible senior notes will bear interest at a rate of 2.50% per year, payable on June 15 and December 15 of each year, commencing on June 15, 2013. The convertible senior notes will mature on December 15, 2017. Upon conversion, holders of the convertible senior notes may receive cash, shares of InterMune's common stock or a combination of cash and shares of InterMune's common stock, at InterMune's election. If InterMune undergoes a "fundamental change" (as defined in the prospectus supplement relating to the convertible senior notes), holders of the convertible senior notes will have the option to require InterMune to repurchase all or any portion of their notes at 100% of par, plus accrued and unpaid interest up to, but not including, the repurchase date.

Holders may convert their notes at their option prior to the close of business on the business day immediately preceding September 15, 2017, but only under certain circumstances. On or after September 15, 2017 until the close of business on the second scheduled trading day prior to the maturity date, holders may convert their notes at any time. The initial conversion rate for each $1,000 aggregate principal amount of convertible senior notes is 77.7001 shares of common stock, equivalent to a conversion price of approximately $12.87 per share, which represents a premium of approximately 30% to the public offering price of InterMune's shares in the concurrent common stock offering.

On or after June 20, 2015, InterMune may redeem for cash all or part of the convertible senior notes at 100% of par (plus accrued and unpaid interest up to, but not including, the redemption date) if the last reported sale price of its common stock exceeds 130% of the conversion price then in effect for 20 or more trading days in a period of 30 consecutive trading days ending within the 10 trading days immediately prior to the date of the redemption notice.

Goldman, Sachs & Co. and J. P. Morgan Securities LLC are acting as joint book-running managers of these offerings. Canaccord Genuity, Inc., Leerink Swann LLC, Wells Fargo Securities, LLC and William Blair & Company, L.L.C. are acting as co-managers of the common stock offering. The common stock offering and the convertible senior notes offering are being conducted as separate public offerings by means of separate prospectus supplements filed as part of an effective shelf registration statement filed with the Securities and Exchange Commission (SEC) on Form S-3. Neither of these offerings is contingent upon the consummation of the other. InterMune expects to close these transactions on or about January 22, 2013, and each closing is subject to satisfaction of customary closing conditions. Before investing in either offering, interested parties may read the prospectus supplement and the accompanying prospectus for such offering and the other documents InterMune has filed with the SEC, which are incorporated by reference in the prospectus supplements and the accompanying prospectus and provide more complete information about InterMune and the offerings. Copies of the preliminary prospectus supplements and the accompanying prospectus relating to each offering may be obtained, when available, from Goldman, Sachs & Co. (Attn: Prospectus Department, 200 West Street, New York, New York 10282, Fax: 212-902-9316 or Email at prospectus-ny@ny.email.gs.com or by calling 1-866-471-2526) or J.P. Morgan Securities LLC (c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by calling 866-803-9204). Electronic copies of the prospectus supplements may be obtained by visiting EDGAR on the SEC's website at http://www.sec.gov/.

This announcement does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. This press release is being issued pursuant to and in accordance with Rule 134 under the Securities Act of 1933, as amended. Any offer, if at all, will be made only by means of a prospectus supplement and the accompanying prospectus, forming a part of the effective registration statement.

About InterMune
InterMune is a biotechnology company focused on the research, development and commercialization of innovative therapies in pulmonology and fibrotic diseases.

Forward-Looking Statements
This announcement contains forward-looking statements, including statements relating to InterMune's expectations regarding the completion, timing and size of the proposed public offerings. These statements are subject to significant risks and uncertainties, actual results could differ materially from those projected and InterMune cautions investors not to place undue reliance on the forward-looking statements contained in this release. These risks and uncertainties include, without limitation, risks and uncertainties related to market conditions and satisfaction of customary closing conditions related to the public offerings. There can be no assurance that InterMune will be able to complete either one or both of the public offerings on the anticipated terms, or at all. If InterMune is unable to raise additional capital when required or on acceptable terms, it may have to significantly delay, scale back or discontinue one or more of its drug development or discovery research programs. Additional risks and uncertainties relating to InterMune and its business can be found in the "Risk Factors" section of InterMune's Form 10-K filed with the SEC and quarterly reports on Form 10-Q, and in the prospectus supplements related to the proposed offerings to be filed with the SEC. InterMune undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in InterMune's expectations.

SOURCE InterMune, Inc.


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