Healtheon/WebMD Invests $100 Million in VitalWorks
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With the agreement, Healtheon/WebMD will purchase $10 million in cash preferred stock prior to VitalWorks.com's IPO, which would equal 1 percent of the VitalWorks outstanding shares after the completion of its initial public offering. The online health care firm will invest an additional $90 million ($40 million in cash and $50 million of Healtheon/WebMD common stock) upon completion of the IPO.
InfoCure (INCX) will use Healtheon/WebMD's (HLTH) transaction processing platforms and incorporate the WebMD portal into the VitalWorks ASP technology. InfoCure and Healtheon/WebMD have also entered into a joint research and development venture to develop a practice management application which will work in tandem with Healtheon/WebMD's transaction platform. The goal is to increase connectivity between clients.
"We believe that this initiative, along with our previously announced agreements with our other practice management software partners establish Healtheon/WebMD as the leader in healthcare connectivity," said Mike Long, chairman and chief operational officer of Healtheon/WebMD.
Within the past month, Healtheon has forged a number agreements to expand its transaction business to doctors, patients and insurance companies. Its largest deal came Jan. 24, when it bought claims-processing provider Quintiles Transnational (QTRN) for $2.5 billion. Healtheon planned to partially fund the purchase with a $930 million investment from investment firm Janus Capital, made three days later.