Nuance Makes Offer for Zi Corp.

Nuance Communications last week offered to buy all outstanding shares of Zi, a Calgary-based provider of discovery and usability solutions for mobile search, input, and advertising, for 40 cents per share in cash, adding to its previously announced acquisition proposal for a total transaction value of approximately $20 million.

The tender offer is scheduled to expire on Wednesday, December 31,

The US$0.40 per share cash offer represents a 25 percent premium over the closing price of Zi common shares on NASDAQ on August 13, the last trading day prior to the public disclosure of Nuance’s initial proposal to Zi’s board of directors, and a 38 percent premium over the closing price of Zi common shares on November 25. The offer will be financed though Nuance’s existing cash on hand.

“We continue to believe that our all-cash offer is a compelling opportunity to create value for the stakeholders of both companies,” said Paul Ricci, chairman and CEO of Nuance. “Our revised offer reflects recent adverse changes in market conditions and in Nuance’s assessment of Zi’s valuation following completion of a due diligence review. While we had hoped to work cooperatively with Zi’s board, we are confident that Zi shareholders, when given the chance to reach their own conclusion, will recognize the immediate value and attractive liquidity opportunity this proposal represents and will tender their shares in favor of our offer.”

In a statement of ints Web site, Zi's board of directors vowed to carefully review and consider Nuance's offer, and advise company shareholders of its position regarding the offer by no later than December 11.
 Zi products are featured on more than 1000 handset models and implemented across most technology platforms in the market today.

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