![]() Microsoft will pay $56 a share for Nuance in a transaction it expects to close this calendar year. The purchase price is a 23% premium to Nuance's closing price on Friday. ![]() “Microsoft stock was flat on Monday while Nuance stock rocketed on the news,” Investor’s Business Daily’s Patrick Seitz reported on Monday afternoon, April 12, at the time of the close of business on the day on which the announcement was made. “The deal would give Microsoft more heft in the health-care sector, where Nuance has a strong presence,” Seitz wrote, quoting Wedbush Securities analyst Daniel Ives, who told Seitz that the acquisition was a “no brainer” move for Microsoft. At close of business on Tuesday, April 13, Microsoft stock had risen to $258.49, while Nuance stock had dipped just a few cents to $52.24.Īccording to Seitz’s report, “Nuance ‘represents a unique asset on the health-care front,’ Ives said in a note to clients.Īt the end of the day on Monday, Microsoft stock had risen 6 cents to $255.91, while “Nuance stock blasted 16 percent higher to $52.85,” Seitz reported. ‘We also believe Microsoft can further integrate Nuance's advanced speech technology throughout its consumer and enterprise ecosystem over the coming years to leverage this potential M&A move.’ About 77 percent of U.S. Plus, more than 55 percent of physicians and 75 percent of radiologists in the U.S. Doctors use its software to transcribe their spoken notes into patient records. Burlington, Mass.-based Nuance is at the forefront of digitizing the health-care industry,” Seitz wrote. Last year, Microsoft launched its Microsoft Cloud for Healthcare offering,” he wrote and he quoted Microsoft CEO Satya Nadella as stating in the press release announcing the deal, as stating that “Nuance provides the AI layer at the health care point of delivery and is a pioneer in the real-world application of enterprise AI.” He added that “Microsoft said the acquisition will accelerate its efforts to provide cloud computing services for health-care companies. ![]() In a report published on Sunday afternoon, hours before the official announcement was made, CNBC’s Alex Sherman and Jordan Novet wrote, speaking of the merger, that “The plans illustrate Microsoft’s recent efforts to expand through deals. operations of video-sharing app TikTok last year, and last month it completed the $7.5 billion acquisition of video game maker Zenimax. Nuance would be more aligned with the part of Microsoft’s business that serves businesses and governments. Nuance derives revenue by selling tools for recognizing and transcribing speech in doctor’s visits, customer-service calls and voicemails. ![]() Nuance was founded in 1992, with 7,100 employees as of September.” The company reported $7 million in net income on about $346 million in revenue in the fourth quarter, with revenue declining 4 percent on an annualized basis. Sherman and Novet also reported that “Microsoft first approached Nuance in December, the person said, and is willing to pay about $56 per share for Nuance,” a person familiar with the merger talks told them. “That would give Nuance an equity value of about $16 billion, representing a 23% premium over the stock’s Friday closing price of $45.58 per share.” What’s more, they noted, “At $16 billion, Nuance would be Microsoft’s second largest acquisition, after the $27 billion purchase of LinkedIn in 2016.īuying Nuance could expand Microsoft’s capabilities in voice software. ![]() Microsoft already has tools that developers can use to enable applications to transcribe speech into written words, and it incorporates speech recognition into its own products, such as the Bing search engine and the Teams communication app,” they wrote. Industry analysts and observers shared a range of reactions to the business move. ![]()
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