Scansoft - Neemt Nuance over
ScanSoft, Inc. (Nasdaq: SSFT - news) and Nuance Communications, Inc. (Nasdaq: NUAN - news) have signed a definitive agreement under which ScanSoft will acquire all of the outstanding common stock of Nuance, merging the two organizations into a single company.
ScanSoft will issue approximately 28 million shares of its common stock to Nuance shareholders, who will receive 0.77 shares of ScanSoft common stock for each share of Nuance common stock that they own.
Additionally, each Nuance shareholder will receive US$2.20 of cash per share of Nuance common stock owned.
The transaction is valued at approximately $221 million based on the closing price of ScanSoft common stock of $4.46 per share on May 6, 2005, or $122 million net of Nuance's cash and equivalents of $98.7 million on March 31, 2005, which includes $11.1 million of restricted cash.
Upon closing, ScanSoft expects to have approximately $80 million in cash and marketable securities. The transaction is expected to generate cost synergies between $20 million and $25 million per year through headcount reductions, office site consolidations and elimination of duplicate operating expenses.
In ScanSoft's fiscal year 2006, the company expects combined revenue to exceed $315 million. ScanSoft expects that the transaction will be accretive to ScanSoft shareholders for fiscal year 2006.
Advancing Emerging Speech Industry
"Speech software is transforming the way people use digital devices and access information systems," said Paul Ricci, ScanSoft chairman and CEO.
Currently, ScanSoft and Nuance together automate more than 20 million contact center and directory assistance calls per day; bring the power of speech to millions of people through mobile phones, automobiles, consumer electronics and games; and provide dictation systems for more than 3,000 hospitals and more than one million consumers worldwide, according to the companies.
"This merger brings together the customer successes, technical talents and sales and marketing competencies of both companies," said Chuck Berger, president and CEO of Nuance. "Paul and I agreed that by combining our companies, we will be in the best position to advance the emerging speech industry into stronger growth and maturity and provide superior financial results for shareholders."
Support for VoiceXML
Combined, ScanSoft and Nuance have deployed more than 3,000 speech applications that automate approximately seven billion phone conversations for some of the world's largest companies, including Bank of America (NYSE: BAC - news), British Airways, Citigroup, General Electric (NYSE: GE - news), NTT, Verizon (NYSE: VZ - news) and Vodafone, the companies pointed out.
Together, the two companies maintain speech-focused professional service organizations with a combined team of approximately 250 speech and voice user-interface experts.
Each firm brings a broad set of speech applications and technologies to the combined company, the companies noted -- assets that will allow the merged organization to satisfy a wider set of customers' speech needs from a single source.
As speech technologies continue to converge, the combined company aims to leverage network speech, embedded speech and dictation to drive innovation and more-complete speech applications.
Both ScanSoft and Nuance are strong participants in the development of VoiceXML including providing multiple editors, and both companies were founding drafters of the MRCP specification.
The combined company will build upon strong relationships with Avaya (NYSE: AV - news), Cisco (Nasdaq: CSCO - news), Genesys, Nortel (NYSE: NT - news) and others to further promote the innovation and adoption of speech, said ScanSoft and Nuance.
Merged Company To Take 'Nuance' Name
Paul Ricci will be the chairman and CEO of the merged company. As part of the transaction, two of Nuance's board members, including Chuck Berger, president and CEO of Nuance, will join the ScanSoft board of directors.
The transaction has been approved unanimously by both boards of directors and is subject to the approval of ScanSoft and Nuance shareholders and normal closing conditions that include regulatory approvals.
The combined company will assume the name "Nuance" after the transaction closes. The Nuance brand is widely respected in the speech market and is inclusive enough to serve as an identity for the combined company's entire product line, the two firms said.
The combined company will continue to make available and support the products of both companies. As in previous ScanSoft mergers and acquisitions, they said, the core technologies will be integrated into a single, unified offering over time.
ScanSoft will issue approximately 28 million shares of its common stock to Nuance shareholders, who will receive 0.77 shares of ScanSoft common stock for each share of Nuance common stock that they own.
Additionally, each Nuance shareholder will receive US$2.20 of cash per share of Nuance common stock owned.
The transaction is valued at approximately $221 million based on the closing price of ScanSoft common stock of $4.46 per share on May 6, 2005, or $122 million net of Nuance's cash and equivalents of $98.7 million on March 31, 2005, which includes $11.1 million of restricted cash.
Upon closing, ScanSoft expects to have approximately $80 million in cash and marketable securities. The transaction is expected to generate cost synergies between $20 million and $25 million per year through headcount reductions, office site consolidations and elimination of duplicate operating expenses.
In ScanSoft's fiscal year 2006, the company expects combined revenue to exceed $315 million. ScanSoft expects that the transaction will be accretive to ScanSoft shareholders for fiscal year 2006.
Advancing Emerging Speech Industry
"Speech software is transforming the way people use digital devices and access information systems," said Paul Ricci, ScanSoft chairman and CEO.
Currently, ScanSoft and Nuance together automate more than 20 million contact center and directory assistance calls per day; bring the power of speech to millions of people through mobile phones, automobiles, consumer electronics and games; and provide dictation systems for more than 3,000 hospitals and more than one million consumers worldwide, according to the companies.
"This merger brings together the customer successes, technical talents and sales and marketing competencies of both companies," said Chuck Berger, president and CEO of Nuance. "Paul and I agreed that by combining our companies, we will be in the best position to advance the emerging speech industry into stronger growth and maturity and provide superior financial results for shareholders."
Support for VoiceXML
Combined, ScanSoft and Nuance have deployed more than 3,000 speech applications that automate approximately seven billion phone conversations for some of the world's largest companies, including Bank of America (NYSE: BAC - news), British Airways, Citigroup, General Electric (NYSE: GE - news), NTT, Verizon (NYSE: VZ - news) and Vodafone, the companies pointed out.
Together, the two companies maintain speech-focused professional service organizations with a combined team of approximately 250 speech and voice user-interface experts.
Each firm brings a broad set of speech applications and technologies to the combined company, the companies noted -- assets that will allow the merged organization to satisfy a wider set of customers' speech needs from a single source.
As speech technologies continue to converge, the combined company aims to leverage network speech, embedded speech and dictation to drive innovation and more-complete speech applications.
Both ScanSoft and Nuance are strong participants in the development of VoiceXML including providing multiple editors, and both companies were founding drafters of the MRCP specification.
The combined company will build upon strong relationships with Avaya (NYSE: AV - news), Cisco (Nasdaq: CSCO - news), Genesys, Nortel (NYSE: NT - news) and others to further promote the innovation and adoption of speech, said ScanSoft and Nuance.
Merged Company To Take 'Nuance' Name
Paul Ricci will be the chairman and CEO of the merged company. As part of the transaction, two of Nuance's board members, including Chuck Berger, president and CEO of Nuance, will join the ScanSoft board of directors.
The transaction has been approved unanimously by both boards of directors and is subject to the approval of ScanSoft and Nuance shareholders and normal closing conditions that include regulatory approvals.
The combined company will assume the name "Nuance" after the transaction closes. The Nuance brand is widely respected in the speech market and is inclusive enough to serve as an identity for the combined company's entire product line, the two firms said.
The combined company will continue to make available and support the products of both companies. As in previous ScanSoft mergers and acquisitions, they said, the core technologies will be integrated into a single, unified offering over time.
posted at 1:22 p.m.
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