, a health care services and information provider, and media titan
have agreed to dismantle two joint ventures, resulting in a one-time non-cash charge of about $275 million for WebMD in the quarter ending Dec. 31, 2000.
Atlanta-based WebMD said it will take over News Corp.'s 50% stake in their international media services venture. News Corp. will also be relieved of its obligation to provide $300 million of international media services, the first $100 million of capital and any future capital requirements to the international joint venture, WebMD said.
WebMD also will no longer have any capital commitments to The Health Network, a health-focused cable TV channel, which will be fully controlled by News Corp. WebMD will not be required to issue an additional 8.3 million shares of its common stock in exchange for News Corp.'s 50% interest in The Health Network.
However, WebMD, which previously announced it is undergoing a restructuring, said it will retain the rights to $205 million in domestic media services over 10 years and will continue to provide its content for use across News Corp.'s media properties for $48 million over four years.
Additionally, News Corp. will transfer to WebMD the 155,951 shares of WebMD's Series A preferred stock that it issued in January 2000. WebMD will issue to News Corp. a warrant to acquire 3 million shares of its common stock at an exercise price of $15 a share. WebMD's Series A preferred stock would have been convertible into 21,282,645 shares of WebMD common stock in January 2003.
WebMD shares closed Friday at $7.94.