• October 21, 2008

WebMD Health Corp. and parent company HLTH Corp. have pulled the plug on their planned merger, citing recent turmoil in the financial markets. The companies' boards concluded that each side would benefit more if WebMD remained as a publicly traded subsidiary of HLTH, which owns 84% of the online health portal.

"The Boards of Directors of HLTH and WebMD believe that in the current economic environment, it is important for a growth company like WebMD not to be encumbered by $650 million in long-term debt that would be coming due in 18 to 36 months," said Martin J. Wygod, chairman of the board of HLTH and of WebMD, in a statement Monday.

He added that terminating the merger would both companies would have the financial flexibility to pursue potential acquisitions. WebMD last month bought Marketing Technology Solutions (MTS), which specializes in performance-based advertising for the health community and whose properties include QualityHealth.com.

Aiming to challenge category leader WebMD, Revolution Health Network and Waterfront Media, owner of the Everyday Health Network, announced a merger valued at $300 million earlier this month.--Mark Walsh