01-28-2008

NEW YORK, Jan 28 (Reuters) - Internet conglomerate IAC/InterActiveCorp (IACI.O: Quote, Profile, Research) is taking a minority stake in the HealthCentral Network, an owner of Web sites that focus on specific health disorders for their communities of patients.

IAC is due to disclose the investment on Monday, part of a round of financing in HealthCentral that also includes previous backers Polaris Ventures, Sequoia Capital, The Carlyle Group [CYL.UL] and Allen & Co.

Terms of the deal were not disclosed, but blog paidContent.org reported the total round of financing ran as high as $50 million.

IAC Chief Executive Barry Diller and Peter Horan, the company's media and advertising segment CEO, will take seats on HealthCentral's board. HealthCentral is home to about 30 sites offering specific information to patients such as MyDepressionConnection.com and MyMigraineConnection.com.

Executives from both companies say IAC will be able to tap into HealthCentral's growing advertiser base, and increase the network's reach through IAC sites such as the Ask.com search engine and eVite invitation service.

"We're seeing patients both wanting to and needing to take more control over health decisions," Horan told Reuters. "There's one really strong player in health -- WebMD (WBMD.O: Quote, Profile, Research) -- and nobody else. There appears to be a market inefficiency and an opening there."

HealthCentral aims to expand into new health categories, but also tailor sites about certain disorders for more than one potential audience. For example, information for teenagers about depression would focus on different aspects of the disorder than a 40-year-old adult would seek.

"The way people behave online, they don't search for health generally, they search for the very specific needs they have," HealthCentral CEO Chris Schroeder said.

While some health sites focus on advice from doctors and encyclopedic information about diseases, HealthCentral aims to increase discussion among patients by letting site users create profiles and share their experiences of health problems.

Schroeder said a recent e-mail he received from a patient summed it up this way: "'I love my doctor, but she's never had what I've had.' That's what we're thinking."

He also said the company posted advertising growth of 40 percent to 50 percent last year alone.

IAC is in the midst of a legal dispute with its controlling shareholder, Liberty Media (LINTA.O: Quote, Profile, Research), over plans to spin off four of its largest business units. IAC's media and advertising operations are to stay within the company after any spin-offs. (Reporting by Michele Gershberg; Editing by Braden Reddall)

http://www.reuters.com/article/marketsNews/idUKN2741130920080128?rpc=44