HLTH and its subsidiary WebMD Health say they have canceled a $2.31 billion cash-and-stock based merger because of recent turmoil in the financial markets.

The boards of directors of both companies favored ending the deal, the companies say.

"The boards of directors of HLTH and WebMD believe that, in the current economic environment, it is important for a growth company like WebMD not to be encumbered by $650 million in long-term debt that would be coming due in 18 to 36 months," said Martin J. Wygod, chairman of HLTH and WebMD, in statement.

HLTH holds an 84% stake in WebMD.