Microsoft Corp says it will buy artificial intelligence and speech technology firm Nuance Communications Inc for about $US16 billion ($A21 billion) as it builds out its cloud strategy for healthcare and enterprise customers.
The deal comes after the companies partnered in 2019 to automate clinical administrative work such as documentation and as Microsoft tries to extend its leadership in vertical cloud solutions in major industries including healthcare.
"This acquisition brings our technology directly into the physician and patient loop, which is central to all healthcare delivery. The acquisition will also expand our leadership in cross-industry enterprise AI and biometric security," Microsoft CEO Satya Nadella said on an investor call.
Microsoft's offer of $US56 per share represents a premium of 22.86 per cent to Nuance's most recent closing price.
Nuance shares were up 16.8 per cent at $US53.24 about midday.
Nuance, known for pioneering speech technology and helping launch Apple Inc's assistant Siri, has been doubling down on healthcare and enterprise AI.
The company has spun off and sold a number of less profitable business units.
With operations in 28 countries, the Burlington, Massachusetts-based company reported $US1.5 billion in revenue in fiscal-year 2020.
The company said it serves 77 per cent of US hospitals, providing intelligent solutions including clinical speech recognition, medical transcription and medical imaging.
Australian Associated Press