Wednesday, December 31, 2008

Nuance extends Zi buyout offer deadline

By Galen Moore

Nuance Communications Inc. said that it will extend until Jan. 16 its offer to buy Zi Corp. for $20 million. The proposed deal is worth half an original offer first proposed by Nuance in August and is the latest salvo in a back-and-forth between the two companies that has included two buyout offers and a lawsuit.

Burlington-based Nuance’s offer to buy all the outstanding common shares of Zi Corp. at 40 cents per share was scheduled to expire at 5 p.m. Mountain Time on Jan. 2. The offer is 25 percent above the closing price on Aug. 13, 2008, when Nuance made an initial proposal to Zi’s board of directors, according to Nuance’s press release.

Nuance (Nasdaq: NUAN), a developer of speech-recognition products for phones, had in August offered to buy Zi Corp., a Canadian provider of mobile search, input and advertising software, for 80 cents a share, a $40.4 million offer. Zi’s board declined to negotiate with the company however, and later in August Nuance announced a patent infringement lawsuit against Zi, alleging the Canadian company’s Qix and eZiText products had infringed two Nuance patents, both titled “Reduced Keyboard Disambiguating System.”

Nuance first proposed its reduced buyout offer in November.

Nuance was awarded a Tech Dealmaker Award this year, sponsored by Mass High Tech and the Association for Corporate Growth Boston, for its $367.7 million acquisition of medical transcription software company eScription Inc.

In October, Nuance made two major acquisitions: SNAPin Software Inc., a Washington State-based developer of mobile device and server self-service technology, for $180 million; and Austria-based Philips Speech Recognition Systems for $96.1 million.