Demonstrating the value of convertible debt, certain holders of InterMune's (ITMN -0.6%) Convertible Senior Notes exchange the debt for shares in several private transactions.
On June 30 and July 1 certain holders of the company's 2.50% Convertible Senior Notes due 2017 (the "2017 Notes") exchange $41M in aggregate principal amount of the debt for 3,185,703 shares of ITMN common stock ($12.87/share) plus $1,332,500 plus accrued unpaid interest. Based on today's price of ~$44 per share, this represents a tidy $100.5M gain on principal (($44 x 3,185,703 + 1.3M) - 41M).
Also on July 1, certain other holders of the 2017 Notes exchanged $11.93M in aggregate principal amount for 908,423 shares of common stock plus $1,213,648 representing a conversion price of $12.87 per share and a gain on principal of $29.3M.
Also on July 1, certain holders of the company''s 5.00% Convertible Senior Notes due 2015 exchange $16.86M in aggregate principal amount of the notes for 893,008 shares of common stock plus $674,400 representing a conversion price of $18.88 and a gain on principal of $23.1M.
InterMune expects to issue all shares by July 7.