Microsoft’s Healthcare Push, To Acquire AI Firm Nuance Communications For $16B

United States based software giant Microsoft Corp will be acquiring artificial intelligence and speech technology firm Nuance Communications Inc in a deal worth about $6 billion in cash, the company said on Monday. Analysts said that this is a part of the strategy of Microsoft to further its business in the area of cloud strategy in the healthcare segment.

This is not the first time that the two companies have worked together. In 2019 both the companies have worked together to automate clinical administrative work which includes documentation, gain from a boom in telehealth services as there is a shift in the area of medical consultations towards online medium because of the Covid-19 pandemic which restricts movement and face to face interactions.  

“Nuance provides the AI layer at the healthcare point of delivery,” Microsoft CEO Satya Nadella said in a statement.

“AI is technology’s most important priority, and healthcare is its most urgent application,” he added.

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

The ;process if launch of Apple Inc’s assistant Siri was assisted by Nuance while it also makes software for a range of businesses which include those for the automotive sector.

The company said that the role of the chief executive officer of Nuance after acquisition will be continued to be held by Mark Benjamin and will report to Scott Guthrie, executive vice president of Cloud & AI at Microsoft.

This is the latest deal for Microsoft in a spree of acquisitions including the recent purchase of the gaming company ZeniMax Media even as there were reports of making investment in the messaging platform Discord which allows its users to hold independent live audio events.

If the deal for acquiring Nuance goes through, it will be the second largest for Microsoft after its 2016 acquisition of LinkedIn in a deal worth $26.2 billion.

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.

(Adapted from

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