The trading week began pleasantly for shareholders in WebMD Health Corp. (WBMD). The health information services provider's stock price was up more than 19% as of 11:52 a.m. EDT Monday after the company announced that it is being taken private.
Internet Brands, a portfolio company of the global investment firm KKR, has agreed to acquire WebMD for $2.8 billion. The deal values WebMD at $66.50 per share, which represents a 20% premium over Friday's closing price.
WebMD's board of directors has already approved the transaction, and financing for the deal is already fully committed. The acquisition is expected to close in the fourth quarter.
"We believe that this transaction will provide additional flexibility and resources to deliver increased value to consumers, healthcare professionals, employers, and health plan participants, said WebMD CEO Dr. Steven L. Zatz.
Bob Brisco, CEO of Internet Brands, was also excited about the deal and heaped high praise on the company:
"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 catalyze WebMD's future growth."
Since this deal has already been given the thumbs up by WebMD's board and is fully financed it seems highly likely that it will go through without much trouble. With shares currently trading within $0.50 of the buyout price, it likely makes sense for shareholders to take the victory lap and cash in their chips today. Afterward, they should think about using their proceeds to invest in other promising healthcare companies.