WebMD Calls Off Sale, Sun Capital Reportedly in Talks to Sell Thermasys

There is some deal news today.

WebMD has called off the auction to sell itself. WebMD’s special committee has ended discussions “with potential acquirers and its process to review a potential sale of the Company,” the healthcare information provider said in a statement Tuesday.

In November, WebMD hired Credit Suisse to advise on the sale, according to press reports. WebMD was in talks with four PE firms, including Kohlberg Kravis Roberts & Co LP and Providence Equity Partners, by December, according to my coworkers at Reuters. It’s unclear why WebMD called off the talks.

WebMD also said Tuesday that Wayne Gattinella, its CEO and president, resigned. He is being replaced by Anthony Vuolo, CFO and COO, who will be interim CEO. WebMD said it also expects revenue to drop 2% to 8% and that is sees increased competition in its consumer products market this year.

The news caused WebMD’s shares to fall. The stock was off 25.32%, or $9.30, to $27.43 in mid-day trading Tuesday. WebMD currently has a roughly $1.5 billion market cap.

Separately, Sun Capital is reportedly also selling Thermasys, which supplies highly engineered copper/brass and aluminum heat exchanger components and assemblies. The Boca Raton, Fla.-based buyout shop acquired Thermasys in 2005 for an undisclosed amount. Last year, Thermasys bought two U.K. companies, Covrad Holdings and Serck Heat Transfer.

Wellspring Capital is the buyer, according to Standard & Poor’s Leveraged Commentary & Data. Wellspring has tapped GE Capital for $142 million in senior debt financing to back its Thermasys buy, LCD says.