I'll be glad when we get some of this behind us:
NEW YORK, Aug 10 (Reuters) - Shares of Healtheon Corp. fell more than 21 percent on Tuesday as the online heath care company's inside shareholders got their first chance to take profits since the initial public offering in February.
"The lock up is expiring and they (sellers) are flooding the market with a lot of shares," said Richard Lee, an analyst at Wit Capital. "It's obviously putting some pressure on the shares."
Lock-ups are agreements that prohibit primary shareholders from selling their shares until a specified time after the initial market debut.
Shares of Santa Clara, Calif.-based company dropped 8-1/2 to 30-1/2 a share on volume of 5.1 million.
In one of the year's most successful IPOs, Investors in February snapped up Healtheon's initial offering of 5 million shares, sending the stock up 292 percent to $31.38 on its first day of trade.
The stock vaulted to $126 in May after it agreed to acquire the online medical resource WebMD in a $7.9 billion deal, among the biggest Internet mergers to date, designed to create the largest online health service.
But Healtheon shares have steadily eroded and analysts warned a slump would occur when the shares became free to trade.
A Healtheon spokeswoman said that 18-20 million shares -- of the original 52.3 million "locked" shares -- would be "unlocked" today.
The remainder will be released in coming months at the close of several of Healtheon's recent acquisitions, including WebMD and medical information provider Mede America Corp. Shares in Mede America also fell on Tuesday, sliding 2-7/8, or about 15 percent, to 16-7/8 a share.
Healtheon collects fees from a variety of online transactions, including when doctors and dentists use its service to process claims, make specialist referrals, order lab tests or contact pharmacies. |
