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Print Edition StoriesThursday, January 15, 2009
Nuance to sell $175M in stock to PE firm Warburg Pincus
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Speech recognition and imaging software company Nuance Communications Inc. reports that it will sell $175 million of Nuance common stock to private equity firm Warburg Pincus LLC. Nuance will use the resulting capital for general corporate purposes and possible merger and acquisition activity, the company said.
New York-based Warburg Pincus plans to purchase about 17.4 million shares of Nuance stock for $10.06 per share, giving it about a 13 percent stake in the ownership of Burlington-based Nuance (Nasdaq: NUAN). Warburg Pincus will also buy a warrant to purchase 3.86 million shares of Nuance common stock upon the closing of the investment at $11.57 per share.
For six months following the close of the deal, expected early next month, Warburg Pincus has also agreed not to sell any shares of Nuance common stock.
In a separate deal, Nuance reports that it has entered into a joint licensing and services deal with IBM Corp. to incorporate IBM technology into Nuance’s speech products. No financial details of that deal were disclosed.
Warburg Pincus has approximately $30 billion of assets under management, with $10 billion available for investment in a range of sectors including health care, financial services, energy, technology, media, telecommunications, consumer, industrial and real estate.
On the last day of 2008, Nuance said that it will extend until tomorrow, 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.
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.
Nuance reported a net loss for fiscal 2008 of $30 million on revenue of $868 million.
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