Microsoft doubles down on cloud healthcare business with $16 billion Nuance buy
By Chavi Mehta and Krystal Hu (Reuters) - Microsoft Corp said on Monday it would buy artificial intelligence and speech technology firm Nuance Communications Inc for about $16 billion, as it expands cloud solutions for healthcare customers. The deal comes after the companies partnered in 2019 to automate clinical administrative work such as documentation. It shows Microsoft's ambition to extend its leadership into an industry where digital transformation has picked up speed during the pandemic.
By Chavi Mehta and Krystal Hu
(Reuters) - Microsoft Corp said on Monday it would buy artificial intelligence and speech technology firm Nuance Communications Inc for about $16 billion, as it expands cloud solutions for healthcare customers.
The deal comes after the companies partnered in 2019 to automate clinical administrative work such as documentation. It shows Microsoft's ambition to extend its leadership into an industry where digital transformation has picked up speed during the pandemic. Healthcare providers have invested more in technology to improve productivity and digital health services.
"This acquisition brings our technology directly into the physician and patient loop, which is central to all healthcare delivery. The acquisition will also expand our leadership in cross-industry enterprise AI and biometric security," Microsoft CEO Satya Nadella said on an investor call.
Microsoft's offer of $56 per share represents a premium of 22.86% to Nuance's closing price on Friday. The shares gained 16% to close at $52.85 on Monday.
Nuance, known for pioneering speech technology and helping launch Apple Inc's virtual assistant, Siri, has gone through strategic reviews led by Chief Executive Mark Benjamin. Once offering voice recognition technologies across industries, the company now focuses on healthcare and enterprise AI after spinning off and selling a number of less profitable business units.
The company said it serves 77% of U.S. hospitals, providing intelligent solutions including clinical speech recognition, medical transcription and medical imaging.
"Nuance's strong position at the edge (medical dictation and transcription) will ultimately tie healthcare customers more strongly into Microsoft's Azure Cloud and intelligent services,” Forrester analyst J.P. Gownder wrote in a note on Monday.
With operations in 28 countries, the Burlington, Massachusetts-based company reported $1.5 billion in revenue in fiscal-year 2020, with two-thirds of it coming from healthcare.
Benjamin will remain CEO of Nuance and will report to Scott Guthrie, executive vice president of Cloud & AI at Microsoft, the company said. (https://refini.tv/3a5Ux5z)
The deal follows Microsoft's recent $7.5 billion acquisition of gaming company ZeniMax Media, and reports that Microsoft was in talks to buy messaging platform Discord, which also allows live audio events.
Once closed, the deal for Nuance would be Microsoft's second-biggest, after its $26.2 billion acquisition of LinkedIn in 2016. Including net debt, the all-cash transaction is valued at $19.7 billion.
Goldman Sachs is the financial adviser to Microsoft, while Evercore advised Nuance.
(Reporting by Chavi Mehta in Bengaluru and Krystal Hu in New York; Editing by Susan Fenton and Matthew Lewis)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.