Nearly a full year after first announcing its intent to acquire Nuance Communications, Microsoft has finally closed the $19.7 billion buy.
Along the way, the companies had to face challenges by antitrust investigators in the U.K. and the EU even as it secured relatively speedy signoffs from regulators in the U.S. and Australia.
With those hurdles now cleared, Microsoft is free to add Nuance’s conversational artificial intelligence technology to its cloud services platform, with the goal of improving clinical productivity and patient outcomes for its healthcare customers.
“This powerful combination will help providers offer more affordable, effective and accessible healthcare, and help organizations in every industry create more personalized and meaningful customer experiences,” said Scott Guthrie, executive vice president of Microsoft’s cloud and AI group.
Under the terms of the original deal laid out in April 2021, Microsoft paid $56 in cash per Nuance share, representing about a 23% premium over the stock’s closing price prior to the acquisition announcement.
In total—factoring in Nuance’s net debt that Microsoft also acquired in the transaction—the tech giant shelled out $19.7 billion to buy out the AI developer.
With the close of the deal, Mark Benjamin will hang onto his position as CEO of Nuance and will report to Microsoft’s Guthrie.
“Combining the power of Nuance’s deep vertical expertise and proven business outcomes across healthcare, financial services, retail, telecommunications and other industries with Microsoft’s global cloud ecosystems will enable us to accelerate our innovation and deploy our solutions more quickly, more seamlessly and at greater scale to solve our customers’ most pressing challenges,” Benjamin said.
In the months between when Microsoft first announced the acquisition and its eventual close, the deal was the subject of two antitrust probes across the pond.
In the EU, the European Commission’s competition bureau surveyed clients and competitors of Nuance and Microsoft to evaluate whether the two companies could be considered competitors and, if so, whether their combining would negatively impact competition in the industry.
Within a month, the commission closed out the investigation, concluding that the deal “would not significantly reduce competition in the transcription software, cloud services, enterprise communication services, customer relationship management, productivity software and PC operating systems markets.”
The second probe came from the U.K., where investigators from the Competition and Markets Authority raised similar concerns in December about the acquisition’s potential impact on the market.
At the beginning of this month, however, the agency gave (PDF) the all-clear, having found the acquisition “does not give rise to a realistic prospect of a substantial lessening of competition in any market in the U.K.”