WebMD Corp. (Nasdaq: HLTH) hit a new 52-week low Thursday, falling 1 3/16 to 8 1/2 after the company, which links doctors, health care organizations, insurers and pharmacies over the Internet, said co-chief executive officer Jeffrey T. Arnold resigned.
“In the last two years, we have put together the assets required for WebMD to take a leading role in the evolution of health care,” said Arnold. “Now, the focus is on streamlining the organization and delivering maximum value to shareholders. I am confident that the team in place can successfully lead this effort.”
The move leaves Martin J. Wygod as sole chief executive of the Atlanta, Georgia-based company.
WebMD also said Netscape founder Jim Clark resigned from the board of directors. Clark is also the founder of Healtheon, which merged with WebMD last year.
Last month, WebMD announced a sweeping restructuring plan designed to save $250 million per year beginning in next year’s fourth quarter. The move, which will result in the elimination of about 1,100 jobs by the end of 2001, is aimed at streamlining operations and integrating four recent acquisitions.
The company — until recently known as Healtheon/WebMD — earlier this year acquired Medical Manager Corp. and its CareInsite, Inc. affiliate, along with two other companies, Envoy and OnHealth. WebMD said the restructuring will result in a charge of between $35 million and $45 million to third quarter results, and additional charges are possible as the company evaluates its operations and contracts.
Prudential Securities downgraded WebMD from strong buy to hold after Thursday’s announcement, according to wire reports.