UPDATE: GlaxoSmithKline to Increase Its Ownership in Theravance

GlaxoSmithKline plc

and Theravance, Inc.

announced today that they have entered into a stock purchase agreement, under which Theravance will issue, and GSK will acquire, 10,000,000 shares of Theravance common stock at a price of $21.2887 per share, for a total investment of $212,887,000. Following this purchase, GSK would own 25,814,421 shares of Theravance common stock, which would increase GSK's ownership from approximately 18.3% to approximately 26.8% of the total outstanding capital stock of Theravance. The price per share was determined based upon a 7.5% premium to the volume-weighted average price per share of Theravance common stock over the five-day period ending March 30, 2012, which was $19.8034. The transaction is subject to certain closing conditions, including approval of Theravance's stockholders at their Annual Meeting scheduled for May 15, 2012, and expiration of the waiting period under the Hart-Scott-Rodino Act. The transaction is expected to be completed shortly after the Theravance Annual Meeting. GSK expects to continue to account for its total stake in Theravance as an investment held at fair value, due to the existing governance agreement which places limitations on GSK's voting rights.