Nuance Communications, Inc. (NASDAQ: NUAN) is to be bought by Microsoft Inc (NASDAQ: MSFT). It has been disclosed that Microsoft is in discussion with the firm to purchase it. Microsoft has offered a $16 billion deal which includes the payment of $56 per share by MSFT. It represents a premium of 23% as of the closing price of the stock on Friday.

Sources disclosed that both parties are in the discussion stage and if the deal would confirm they will disclose the deal in the following week. Earlier, it has been revealed that MSFT is intending to purchase Chat platform Discord for about $10 billion.

Nuance and Microsoft Collaboration

Previously, in 2019 Microsoft and Nuance have joined forces on technologies to do things like enabling doctors to secure voice chats from sufferers’ appointments and enter the information into electronic medical annals. These technologies are helpful for Microsoft as it speeds up the digitization of the health-care sector.

MSFT is facing intense competition in the AI space with competitors such as Alphabet Inc.’s Google and Inc. also making a substantial investment in the field. Microsoft stepped into the AI space years ago with study projects and an early emphasis by co-founder Bill Gates on discovering methods to make it easy for individuals to talk to computers using simple English.

Nuance has inventions such as Dragon speech-recognition software. It had a net income of $91 million on revenue of $1.48 billion for its fiscal year completing Sept. 30., after dropping $217 million in the preceding year.