The investigation will be carried out to assess whether the deal could result in substantial lessening of competition in the UK for goods or services
Nuance Communications’ headquarters in Burlington, Massachusetts, US. (Credit: Nuance Communications, Inc.)
The UK Competition and Markets Authority (CMA) has announced that it is opening an investigation into Microsoft’s acquisition of conversational artificial intelligence (AI) company Nuance Communications for $19.7bn.
The regulator will probe the deal to assess whether the acquisition will result in lessening of competition within any market or markets in the country for goods or services.
Microsoft entered into an agreement to acquire Nuance in April this year.
The deal is aimed at accelerating its industry cloud strategy for healthcare, as Nuance’s solutions are said to be used by 77% of hospitals in the US.
Nuance’s offerings include speech recognition and AI for multiple sectors. It provided a speech recognition engine for Siri, the virtual assistant of Apple.
The UK regulator stated: “The CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”
The US Department of Justice cleared the acquisition in June, while the Australian Competition Commission approved it in October.
Recently, Reuters reported that the EU’s antitrust regulator is seeking input on the concerns related to the acquisition, through a questionnaire to customers and competitors related to the deal.
The questionnaire was prepared to assess whether Microsoft and Nuance are competitors and how the transaction could impact clients and rivals.
Upon completion, the deal will be Microsoft’s second-largest transaction, after its $26.2bn acquisition of LinkedIn in 2016.
In November this year, the CMA announced the launch of phase 2 probe into US-based Nvidia’s acquisition of British semiconductor and software design company Arm for $40bn.