WebMD Health Corp. (NASDAQ:WBMD) Announces Offering Of Convertible Bonds
New York based WebMD Health Corp. (NASDAQ:WBMD) provides health information services to consumers and healthcare professionals, employers and health plans through public and private online portals, publications and mobile platforms. The stock of WebMD has delivered over 170% returns year to date.
Proposed Offering of Convertible Notes
WebMD Health Corp. (NASDAQ:WBMD) yesterday announced its plans to offer $300 million of convertible notes in a private placement to be due in 2020. WebMD intends to use the net proceeds for acquisitions and repurchases of company’s common stock, for working capital and such other general corporate purposes. The proposed notes will be convertible into WebMD’s common stock, based on a conversion rate, yet to be determined.
WebMD Health Corp. (NASDAQ:WBMD) also plans to allow the early purchaser an option to purchase an additional notes not exceeding $50 million in principal amount, in the proposed offering.
The Share Buyback
During late last month, WebMD Health Corp. (NASDAQ:WBMD) announced to buyback all of the 5.5 million shares of company’s common stock from activist investor Carl Icahn and affiliates. The company was supposed to pay $32.08 per share aggregating $177.3 million. The company financed the buyback from its own cash and cash equivalents.
After the buyback, the company estimated to have about $550 million in cash and cash equivalents and more than $650 million in convertible notes outstanding.
Carl Icahn’s Speculative Pick
As of Sept. 30th, Icahn Associates’ stock portfolio was $24.6 billion in value. Though its top three holdings make up 53% of the overall portfolio’s value, Herbalife Ltd. (NYSE:HLF) is one among its portfolio’s high profile stock and the eighth largest as such. Herbalife recently posted 13% volume growth, 19% revenue growth and 44% earnings growth for 3Q13. While these numbers does not speak much of actual picture, the company beat street estimates for 19th consecutive quarter