Speech recognition and document management firm Nuance Communications of Burlington, MA, has signed an agreement to acquire computer-aided medical transcription technology eScription of Needham, MA, for $363 million.
The agreement includes $340 million in cash and $23 million in Nuance common stock, plus the assumption of vested employee options with a value of approximately $37 million. The transaction is expected to close in Nuance's fiscal third quarter (end-June 30) and remains subject to customary closing conditions and regulatory approvals.
Nuance expects the acquisition to add between $16 million and $18 million in nongenerally accepted accounting principles (GAAP) revenue in fiscal 2008, and between $63 million and $68 million in fiscal 2009.
The company also sees the acquisition as a benefit to its Dictaphone Healthcare division, providing additional technology to enhance transcription productivity and reliability and to accelerate the business' growth in the clinical documentation market.
eScription products include on-demand transcription technology, which would increase Nuance's total on-demand healthcare revenues to $175 million to $200 million in fiscal 2009.
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