Microsoft in advanced talks to buy the voice recognition company Nuance

Microsoft is in advanced talks to acquire voice recognition company Nuance Communications, a person familiar with the talks said Sunday. The person was able to sign a transaction on Sunday and announce it as early as Monday.

The plans illustrate Microsoft’s recent efforts to expand through agreements. Microsoft considered buying U.S. operations of the TikTok video sharing application last year and last month completed the $ 7.5 billion acquisition of video game maker Zenimax.

The nuance would be more aligned with the part of Microsoft’s business that serves businesses and governments. The nuance earns revenue by selling tools to recognize and transcribe speech to doctor visits, customer service calls, and voice messages. The company reported net income of $ 7 million for about $ 346 million in revenue in the fourth quarter, down 4% year-on-year. Nuance was founded in 1992, with 7,100 employees in September.

The person said Microsoft first approached Nuance in December and is willing to pay about $ 56 per share for Nuance, the person said. That would give Nuance a net worth of about $ 16 billion, which would represent a 23% premium over Friday’s closing price of $ 45.58 per share.

Bloomberg reported on Microsoft’s plans to buy Nuance before Sunday. Microsoft declined to comment. A Nuance representative did not immediately respond to a request for comment.

With $ 16 billion, Nuance would be Microsoft’s second acquisition after LinkedIn’s $ 27 billion acquisition in 2016.

Buying Nuance could expand Microsoft’s capabilities in voice software. Microsoft already has tools that developers can use to allow applications to transcribe voice into written words, and incorporates voice recognition into their own products, such as the Bing search engine and the Teams communication application.

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