Mirum Pharmaceuticals Inc. (NASDAQ: MIRM) announced plans to offer $600 million in convertible senior notes due 2032 through a private placement to qualified institutional buyers, according to a company statement.

The rare disease company also expects to grant initial purchasers an option to buy an additional $90 million in notes, which must be settled within 13 days of the initial issuance.

The notes will be senior, unsecured obligations that accrue interest payable semi-annually and mature on June 1, 2032, unless converted, redeemed or repurchased earlier. Noteholders can convert their notes under certain circumstances and during specified periods. Mirum will settle conversions using cash, common stock shares or a combination of both, at the company's discretion.

Mirum plans to use part of the net proceeds to pay cash consideration in note exchange transactions involving its existing 4.00% convertible senior notes due 2029. The company will use remaining proceeds for general corporate purposes, which may include acquiring complementary products, technologies, intellectual property or businesses.

The company expects to exchange a portion of its outstanding 2029 notes for new shares of common stock through privately negotiated transactions conducted alongside the new offering's pricing. The exchange terms will depend on various factors, including Mirum's stock price and the 2029 notes' trading price.

Mirum noted that holders of 2029 notes who have hedged their equity price risk may unwind hedge positions by purchasing the company's common stock or entering derivative transactions. This activity could affect Mirum's stock price and the new notes' effective conversion price.

The notes and any shares issuable upon conversion have not been registered under the Securities Act of 1933 and will be offered under applicable exemptions.