April 12 (UPI) -- Microsoft announced Monday it has entered into a deal to acquire speech recognition company Nuance Communications.
In a statement Monday, Microsoft said it would acquire Nuance for $56 per share, 23% above its closing price Friday, in a deal worth about $16 billion, and approximately $19 billion including debt.
"Nuance provides the AI layer at the healthcare point of delivery and is a pioneer in the real-world application of enterprise AI," Microsoft CEO Satya Nadella said. "AI is technology's most important priority and healthcare is its most urgent application."
Nuance sells tools for recognizing and transcribing speech in doctor office visits, customer-service calls and voicemails and Microsoft said Monday it will use the systems to "deliver new cloud and AI capabilities across healthcare and other industries."
"Over the past three years, Nuance has streamlined its portfolio to focus on the healthcare and enterprise AI segments, where there have been accelerated demand for advanced conversational AI and ambient solutions," Nuance CEO Mark Benjamin said.
Benjamin will remain with the company and report to Scott Guthrie, executive vice president of Cloud & AI at Microsoft.
The deal is set to close by the end of the calendar year, pending approval by Nuance's shareholders and regulators.
Nuance stock climbed 15.95% by the end of trading Monday.