Healtheon to acquire Quintiles unit for $2.5 billion
ATLANTA, Jan 24 (Reuters) - Healtheon/WebMD Corp. (NASDAQ: HLTH), which connects consumers, doctors and other providers via the Internet, said on Monday it will buy the electronic data interchange unit of Quintiles Transnational Corp. (NASDAQ: QTRN), the ENVOY Corp., in a deal valued at $2.5 billion.
Under the terms of the definitive agreement, Quintiles, a provider of research, sales consulting and information management services to the health care industry, will receive 35 million shares of Healtheon/WebMD stock and $400 million cash.
Quintiles, based in Research Triangle Park, N.C., will issue Healtheon/WebMD a warrant to purchase up to 10 million shares of its common stock at $40 per share, exercisable for four years. It will also provide Healtheon with development funding of up to $100 million over the next 18 months to develop Web-based products and services.
Based upon current pro forma shares outstanding, Quintiles would own about 16 percent of Healtheon/WebMD.
Healtheon/WebMD common closed on Friday at 59-9/16. Quintiles closed at 24-7/16.
With the acquisition of ENVOY, which is the largest processor of healthcare electronic data interchange (EDI) transactions in the United States, including pharmacy, medical, dental and patient statement exchanges, Healtheon/WebMD will process almost 2 billion transactions a year, it said.
Quintiles said that it estimates the transaction to be dilutive by 25 cents to 30 cents a share in 2000. |
