ScanSoft, Nuance to merge.ScanSoft, Inc. and Nuance Communications Nuance Communications is a computer software technology company. Their current worldwide headquarters is in Burlington, Massachusetts in the United States. Nuance provides speech and imaging solutions and is mainly known for its speech recognition and speech synthesis software that , Inc. recently announced that the two companies have signed a definitive agreement whereby ScanSoft will acquire all of the outstanding common stock of Nuance nu·ance n. 1. A subtle or slight degree of difference, as in meaning, feeling, or tone; a gradation. 2. Expression or appreciation of subtle shades of meaning, feeling, or tone: , merging the two organizations into a single company. Under the terms of the agreement, 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 they own. Additionally, each Nuance shareholder will receive $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 Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has . The transaction is expected to generate cost synergies Cost Synergy In the context of mergers, cost synergy is the savings in operating costs expected after two companies, who compliment each other's strengths, join. Notes: The savings in operating costs usually come in the form of laying off employees. between $25 million and $30 million per year through headcount reductions, office site consolidations and elimination of duplicate operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. . In ScanSoft's fiscal year 2006, the company has stated that it expects combined revenue to exceed $315 million. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the companies, ScanSoft and Nuance combined automate more than 20 million contact center and directory assistance calls per day; bringing speech functionality to millions of people through mobile phones, automobiles, consumer electronics and games; and providing dictation solutions for more than 3,000 hospitals and more than one million consumers worldwide. The combination of ScanSoft and Nuance is expected to bring together one of the industry's most comprehensive portfolios of speech applications, technologies and expertise. ScanSoft and Nuance will each bring a set of speech applications and technologies to the combined company. These assets will theoretically allow the combined company to satisfy a wider set of customers' speech needs from a single source. As speech technologies continue to converge con·verge v. con·verged, con·verg·ing, con·verg·es v.intr. 1. a. To tend toward or approach an intersecting point: lines that converge. b. , the combined company will be able to leverage a set of resources that spans the full breadth of speech capabilities--including network speech, embedded Inserted into. See embedded system. speech and dictation. The combined organization will bring together an array of resources--from 300 speech scientists and engineers to a patent portfolio comprising more than 250 patent families. With these assets, the combined company is positioned to handle complex implementations and potentially solve more difficult problems with speech technology. Both ScanSoft and Nuance have been active proponents of speech industry standards. Both companies are strong participants in the development of VoiceXML, including providing multiple editors, and both companies were founding drafters of the MRCP MRCP Member of Royal College of Physicians. MRCP abbr. Member of the Royal College of Physicians specification. Paul Ricci will be the chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. 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. ScanSoft expects the transaction to close in September 2005. www.nuance.com and www.scansoft.com |
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