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Investment firm pays $2.8bn for WebMD

The online health information portal will join KKR's Internet Brands subsidiary

WebMD KKR Internet BrandsOnline health information portal WebMD has been acquired by a US investment firm for $2.8bn.

KKR will roll WebMD into its Internet Brands subsidiary, a leading web hosting and software-as-a-service (SaaS) company that works in a number of sectors, including health.

WebMD’s CEO Steven Zatz said the deal would be the beginning of an exciting new chapter for his company.

"We believe that this transaction will provide additional flexibility and resources to deliver increased value to consumers, healthcare professionals, employers, and health plan participants," he added.

WebMD announced in February that it would be exploring ‘strategic alternatives’ that could include the sale of part, or all of, the company or a merger with another firm. This came as it projected 2017 revenues would still grow, but would do so more slowly than last year, slowing from 11% grow to $705m in 2016 to $710-730m, and a 1-4% rise.

In the end the process saw WebMD “outreach to more than 100 strategic and financial parties”, Zatz said, before it reached a deal with KKR and its California-headquartered Internet Brands subsidiary.

Internet Brands’ Health operations work with more than 50,000 health care practices across the US, providing web presence, online marketing, and practice management services.

Bob Brisco, CEO of Internet Brands, said: "WebMD and Medscape are the market leaders in online health with unparalleled reach to consumers and healthcare professionals.

"Since its founding, WebMD has established itself as a trusted resource for health information. We look forward to delivering that resource to even more users, by leveraging our combined resources and presence in online healthcare to catalyse WebMD's future growth."

The deal, which has the approval of the WebMD board of directors, is expected to close before the end of 2017.

25th July 2017

From: Healthcare

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