WebMD Inc, an internet healthcare portal, announced it had filed with the Securities and Exchange Commission (SEC) for a $55m IPO (Initial Public Offering). The portal company, which provides healthcare data for doctors and consumers, did not disclose the number of shares to be floated nor their offering price, but the tranche is believed to represent a minority stake in the company. The stock sale will be underwritten by BancBoston Robertson Stephens, Hambrecht & Quist and E*Trade Securities. The company will trade on the Nasdaq stock exchange under the symbol WBMD. The company sold its revenue-making cardiac monitoring business in July last year to concentrate exclusively on its internet operations which it began to offer commercially in October following a three-month beta test. Consequently, the company has so far shown no revenues from this internet business, which makes its IPO unusual, if not unprecedented. Nor does the company expect a quick turnaround; in its SEC filing it said it had an accumulated deficit of $13.9m and expected to incur increasing net operating losses for the ‘foreseeable future.’ That WebMD is confident in going to IPO with no financial history is a reflection of its confidence in what Bill Gates, speaking last week at the World Economic Forum in Davos, Switzerland, called the current ‘gold rush’ mentality in internet stock purchasing. Sources close to the company said WebMD were to some extent capitalizing on the current market demand for internet stock as well as relying on confidence in the executive board’s proven business record and the company’s strong alliances. The company says it has content, services and distributions agreements with 30 companies in the healthcare sector. Last week WebMD announced investments totaling $33.8m from affiliates of four large healthcare companies: McKessonHBOC Inc, Premier Inc, Tenet Healthcare Corp and Trigon Healthcare.
