Microsoft is to acquire Nuance, a provider of speech recognition software, for approximately $19.7 billion.
The companies today entered into a definitive agreement under which Microsoft will acquire Nuance for $56.00 per share, a 23% premium to the closing price of Nuance on Friday, April 9.
Mark Benjamin will remain CEO of Nuance, reporting to Scott Guthrie, executive vice president of Cloud & AI at Microsoft. The transaction is intended to close this calendar year.
The move aims to accelerate Microsoft’s industry-specific cloud strategy, providing conversational AI and ambient clinical intelligence tool for healthcare providers. Nuance’s products include the Dragon Ambient eXperience, Dragon Medical One and PowerScribe One for radiology reporting.
Last year (March 2020) Nuance and Microsoft partnered to release an ambient clinical intelligence solution, to securely capture and contextualise patient-heathcare professional conversations to update an electronic medical record. Optimised microphones in a consultation room are used to capture conversation and automatically document the conversation into a health record.
The company’s Healthcare Cloud revenue experienced 37% year-over-year growth in Nuance’s fiscal year 2020 (ended September 2020).
Satya Nadella, CEO, Microsoft, said: “Nuance provides the AI layer at the healthcare point of delivery and is a pioneer in the real-world application of enterprise AI.
“AI is technology’s most important priority, and healthcare is its most urgent application. Together, with our partner ecosystem, we will put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud for Healthcare and Nuance.”
Mark Benjamin, CEO, Nuance, commented: “Over the past three years, Nuance has streamlined its portfolio to focus on the healthcare and enterprise AI segments, where there has been accelerated demand for advanced conversational AI and ambient solutions.”
“To seize this opportunity, we need the right platform to bring focus and global scale to our customers and partners to enable more personal, affordable and effective connections to people and care. The path forward is clearly with Microsoft — who brings intelligent cloud-based services at scale and who shares our passion for the ways technology can make a difference. At the same time, this combination offers a critical opportunity to deliver meaningful and certain value to our shareholders who have driven and supported us on this journey.”
