Roche Holding AG (SWX:ROG) signed a definitive agreement to acquire InterMune, Inc. (NasdaqGS:ITMN) for $8.1 billion in cash from Sofinnova Investment, Inc. and others on August 22, 2014. Under the terms of the agreement, Roche will commence a tender offer no later than August 29, 2014, to acquire all outstanding shares of InterMune common stock, and InterMune will file a recommendation statement containing the unanimous recommendation of the InterMune board that InterMune's shareholders tender their shares to Roche. Following completion of the tender offer, Roche will acquire all remaining shares at the same price of $74 per share through a second step merger. Financing is not a condition to the offer. Roche will finance the transaction by a combination of available funds, commerical paper lines and newly issued bonds. InterMune, Inc. would pay $266 million as termination fee to Roche.

The merger agreement has been approved by the boards of InterMune and Roche. The transaction is subject to closing of tender offer of a number of shares that represents a majority of the total number of outstanding shares on a fully diluted basis and is subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions. The transaction is expected to close by end of 2014. The offer will remain open till September 26, 2014. The transaction is expected to be neutral to core earnings per share in 2015 and accretive from 2016 onwards. Centerview Partners LLC and Goldman, Sachs & Co provided their opinion to InterMune, Inc. that the offer price of $74 per share is fair from a financial point of view. Financial impact expected to be neutral to Core EPS in 2015 and accretive from 2016. No material impact expected in 2014. As on September 29, 2014, Roche accepted for payment all shares validly tendered. The tender expired on September 26, 2014, and was not extended. As of the expiration of the tender offer, a total of approximately 96.362877 million shares of InterMune common stock were validly tendered and not withdrawn, representing approximately 79.42% of InterMune's outstanding shares on a fully diluted basis. Later on September 29, 2014, Roche intends to complete the acquisition of InterMune through a merger without a vote or meeting of InterMune's shareholders. In the merger, all shares of InterMune not owned by InterMune, Roche will be converted into the right to receive the same cash consideration per share, less any applicable withholding taxes, as was paid in the tender offer. Following completion of the merger, InterMune will become a wholly owned subsidiary of Roche and InterMune's shares will cease to be traded on NASDAQ Stock Market.

Chris Hite from Citi Group and Evercore Partners Inc. (NYSE:EVR) acted as financial advisors to Roche. Alan Hartman and Mark Robinson from Centerview Partners and Jack Levy, David Woodhouse, Jim Katzman and Bartosz Ostenda of Goldman Sachs provided fairness opinion and acted as financial advisors to InterMune. Faiza J. Saeed, Ting S. Chen, Michael L. Schler, Eric W. Hilfers, Christine A. Varney, Amanda R. Fenster, Jennifer L. Tanaka, Jennifer Uren, Jay S. Gill, Nicole F. Foster, Julia L. Onorato, Margaret Segall D'Amico, Benjamin D. Landry and David J. Kappos of Cravath, Swaine & Moore LLP acted as legal advisors, MacKenzie Partners, Inc. acted as the information agent, Computershare Trust Company, N.A acted as the transfer agent, Citibank, N.A. as the depository to InterMune, Inc. Arthur F. Golden, Marc O. Williams, Lee Hochbaum, Brian J. Snyder, Zain Ur Rehman, Jean M. McLoughlin, Edmond T. FitzGerald, Gillian Emmett Moldowan, Ronan P. Harty and Michael Mollerus of Davis Polk & Wardwell LLP acted as legal advisors to Roche Holding. Frank Aquila, Brian Hamilton, William J. Magnuson and Krishna Veeraraghava of Sullivan & Cromwell LLP acted as legal advisors for Centerview Partners. Gibson, Dunn & Crutcher LLP acted as legal advisor for The Goldman Sachs Group, Inc. InterMune has agreed to pay Goldman Sachs a fee of approximately $35.5 million and Centerview an aggregate fee of approximately $35.5 million. Cathrin Petty of JPMorgan Chase & Co. (NYSE:JPM) acted as financial advisor for Roche Holding.

Roche Holding AG (SWX:ROG) completed the acquisition of InterMune, Inc. (NasdaqGS:ITMN) on from Sofinnova Investment, Inc. and others September 29, 2014.