Monday, February 16, 2009

Nuance dogged in pursuit of Zi Corp. buyout

By Mass High Tech staff

Nuance Communications Inc., the Burlington speech and imaging solutions firm, has continued its attempt to acquire Canadian mobile software maker Zi Corp. by further extending its offer deadline to Feb. 24. The latest offer would have expired on Friday, Feb. 13.

The offer from Nuance (Nasdaq: NUAN) stands at 40 cents per common share of Zi stock, or about $20 million. The current offer represents a 25 percent premium over Zi’s closing price of stock traded on Nasdaq on Aug. 13, 2008. Nuance officials have reported that the offer would be financed through the company’s existing cash on hand.

Nuance made an original acquisition offer of Zi Corp. in August, for a cash tender amount of $40.4 million, or about 80 cents per share, which was a 150 percent premium over the Aug. 13 close stock price.

The two companies share a history of contentious entanglement. After Zi rejected Nuance’s initial offer in August, Nuance followed up with a lawsuit accusing Zi of infringing Nuance patents with the Canadian company's Qix and eZiText products. 

Nuance was founded in 1992 as Visioneer Inc. and provides speech and imaging solutions for businesses and consumers, including the Dragon Naturally Speaking voice recognition software application. Nuance reported a net loss for fiscal 2008 of $30 million on revenue of $868 million.

 

An earlier online version of this article incorrectly characterized the legal dispute between Nuance and Zi. In August, Nuance sued Zi, alleging patent infringement.