WebMD, QualityHealth Parent Cancel $50 Million-Plus Acquisition; Ad Pact, Minority Interest Instead

Some consolidation unwinding in the health content area and another deal that won’t happen for WebMD … WebMD Health Corp. and Marketing Technology Solutions, the owner of QualityHealth.com, have “mutually terminated” the acquisition of MTS, a deal announced in September for $50 million in cash plus a possible $25 million earn-out. Instead, WebMD has signed an ad services pact with MTS and acquired a minority preferred interest. WebMD will sell some of QualityHealth.com’s ads and provide “limited access” to some of its own inventory. Release.

It’s the latest in a series of challenges for WebMD (NSDQ: WBMD). Last month, WebMD and majority owner HLTH Corp. canceled a long-planned merger, citing changes in the credit market among other factors. The company’s stock has been on a wild ride, too, swinging from $26.06 on Sept. 15, when the QualityHealth deal was announced, to prices in the $32 range, then dropping to a low of $14.03 on Oct. 16 before climbing back into the $20s, closing Tuesday at $18.63.

WebMD also faces increased competition. Merging QualityHealth.com’s 5.5 million uniques with its own network would have helped with the challenge it faces from Waterfront Media’s EverydayHealth, which recently merged with Steve Case’s Revolution Health LLC. The most recent numbers from comScore (NSDQ: SCOR) Media Metrix put EverydayHealth.com ahead of WebMD in unique visitors, the first time it had dropped from first place in recent memory. But WebMD still claims to be the “leading provider of health information services” through its mix of public and private sites and publications.