Healtheon Confirms WebMD Talks
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After much speculation that a merger may be imminent, Healtheon Corp. confirmed Wednesday that is in in talks with WebMD Inc. about a possible tie-up. However, the company cautioned that no deal has been reached.
Wednesday's Wall Street Journal reported the companies will merge in a $5.5 billion stock deal with backing from technology giants Intel Corp., Microsoft Corp. and Excite, which was recently acquired by @Home Networks.
Microsoft, Excite and Intel will reportedly invest about $500 million in the new company. Excite will pour in $20 million to $30 million and will sell $60 million in advertising to WebMD. Microsoft is already an investor in WebMD and is expected to up its stake by another $200 million.
The newspaper said the companies aim to construct a Web site linking doctors and patients that would serve as a launch pad for electronic commerce in the health care industry.