Microsoft to acquire AI firm Nuance in $19.7-billion deal

Bengaluru: Microsoft Corp. will buy artificial intelligence (AI) and speech technology company Nuance Communications Inc. in a $19.7-billion deal including net debt, as the Seattle-based Big Tech firm seeks to bolster its cloud strategy for healthcare.

Mark Benjamin will remain the chief executive officer of Nuance and will report to Scott Guthrie, executive vice president of Cloud & AI at Microsoft, the company said. Nuance helped launch Apple Inc.’s assistant Siri and also makes software for businesses including automotive.

The Microsoft-Nuance deal comes as both companies, which partnered in 2019 to automate clinical administrative work such as documentation, gain from a boom in telehealth services as medical consultations shifted online due to the Covid-19 pandemic.


“Nuance provides the AI layer at the healthcare point of delivery,” Microsoft’s Chief Executive Officer Satya Nadella said in a statement on Monday, adding that “AI is technology’s most important priority, and healthcare is its most urgent application”.

Microsoft’s offer of $56 per share represents a premium of 22.86% to Nuance’s last close. Shares of Nuance rose nearly 23% in pre-market trading.