Nuance to Acquire Transcend

Nuance to Acquire Transcend


Accretive Transaction to Accelerate Adoption of Nuance Healthcare Solutions by Small- to Mid-Sized Hospital Market, Bring Strong Customer Base and Recurring Revenue

With Transcend, Nuance will accelerate access to and expand its customer base within the small- to mid-size hospital market, which comprises approximately 90 percent of hospitals in the U.S. and increasingly demands cost effective, voice-enabled, clinical documentation solutions to achieve Meaningful Use and the transition to ICD-10. With Nuance’s voice-enabled and Clinical Language Understanding technologies and deep electronic health record (EHR) integration, combined with Transcend’s high-quality transcription and editing services, hospitals can make clinical documentation and workflow more productive and cost efficient and extract greater value from clinical information.

“The acquisition of Transcend will expand the delivery of our innovative voice and Clinical Language Understanding solutions especially to small- and mid-size hospitals,” said Janet Dillione, executive vice president and general manager of Nuance’s Healthcare business. “With Transcend, we will drive change and improvement to the way these hospitals capture and leverage clinical information. The acquisition is a natural extension of Nuance’s existing healthcare business, and will strengthen our solution and services portfolio, as well as enhance our profitability.”

Nuance has agreed to acquire Transcend through a cash tender offer of $29.50 per Transcend share, representing an approximately 30 percent premium over Transcend’s 90-day volume weighted average share price. The transaction has been unanimously approved by the board of directors of each company. Based on Transcend’s 11.1 million diluted weighted average shares outstanding as of December 31, 2011, the acquisition is valued at approximately $300 million, net of Transcend’s estimated cash at closing. The transaction is expected to close in the second half of Nuance’s fiscal 2012, subject to regulatory approval and other conditions.

Nuance expects the acquisition in fiscal 2013 to add between $140 million and $150 million in revenue; non-GAAP earnings between $0.08 and $0.09 per share; and, GAAP earnings between $0.02 and $0.03 per share. See “Discussion of Non-GAAP Financial Measures” below for further information.

The addition of Transcend brings many advantages and synergies to:

• Accelerate Growth within the Small- to Mid-Size Hospital Market – Transcend brings operational excellence and customer satisfaction, as well as a leading position with national Group Purchasing Organizations (GPOs) particularly within the small- to mid-size hospital market. Greater access to these organizations will expand the delivery of Nuance’s voice-driven and Clinical Language Understanding solutions in this segment and in turn will contribute growing revenue streams for Nuance’s healthcare business.
• Strengthen Services for Healthcare Organizations – With Transcend, Nuance will gain additional medical transcription and editing capacity for its healthcare offerings. Together, the combined organization will help a broader set of healthcare organizations achieve cost effective, efficient clinical documentation workflow.
• Drive Recurring Revenue and Enhance Profitability – The acquisition of Transcend is a natural extension of Nuance’s existing healthcare business that affords a stable, recurring revenue stream from its strong customer base and will enhance profitability within the division.

“Nuance recognized Transcend’s services experience and excellence and saw real benefit in adding Transcend’s employees and management team to its healthcare business,” said Larry G. Gerdes, CEO of Transcend. “Both Nuance and Transcend share a vision to reduce healthcare costs through technology and increased efficiencies. The strength of the combined organization will truly benefit the industry and we look forward to providing Transcend customers access to Nuance’s leading HIT technology.”

Key members of the Transcend management team will play integral roles in strengthening Nuance’s position in the healthcare industry, including Susan McGrogan, Transcend’s president and chief operating officer, and Lance Cornell, Transcend’s chief financial officer.

The tender offer is expected to commence on or before March 20, 2012. The offer will be open for a period of not less than 20 business days from its commencement and will be conditioned upon valid acceptances of the offer in respect of shares representing at least a majority of the outstanding Transcend shares on a fully diluted basis as well as other closing conditions, including receipt of required regulatory approval. The tender offer will be followed by a merger in which each Transcend share not acquired in the tender offer will be converted into the right to receive $29.50 per share in cash, without interest. The transaction will be financed through cash on hand at Nuance.

Transcend Services, Inc.
Transcend Services, Inc. (NASDAQ: TRCR) provides premium quality transcription and clinical documentation services to the healthcare industry. Its services encompass a wide range of solutions - people, products and processes - designed to turn medical dictation into meaningful electronic documents. Transcend provides its clients with exceptional quality, turnaround time and service so that they can focus on what matters most – their patients.  For more information, visitwww.Transcendservices.com .

Nuance Healthcare 
Nuance Healthcare, a division of Nuance Communications, is the market leader in providing clinical understanding solutions that accurately capture and transform the patient story into meaningful, actionable information.  Thousands of hospitals, providers and payers worldwide trust Nuance voice-enabled clinical documentation and analytics solutions to facilitate smarter, more efficient decisions across the healthcare enterprise.  These solutions are proven to increase clinician satisfaction and HIT adoption, supporting organizations to achieve Meaningful Use of EHR systems and transform to the accountable care model.  Recognized as “Best-in-KLAS” 2004-2011 for Speech Recognition we invite you to learn more, http://www.nuance.com/for-healthcare/index.htm.

Nuance Communications, Inc.
Nuance Communications, Inc. (NASDAQ: NUAN) is a leading provider of voice and language solutions for businesses and consumers around the world.  Its technologies, applications and services make the user experience more compelling by transforming the way people interact with devices and systems. Every day, millions of users and thousands of businesses experience Nuance’s proven applications.  For more information, please visit www.nuance.com.

Startups Offered Up to $60K in Cloud Services on Windows

News release from Microsoft:

News Press Release

TechStars and Microsoft BizSpark Team Up to Offer Startups $60,000 in Cloud Services on Windows Azure

TechStars taps Microsoft BizSpark Plus to give startups a head start.

BOULDER, Colo. — Jan. 30, 2012 — TechStars, recently recognized as the No. 1 startup accelerator in the world, and Microsoft Corp. are working together to help startups fast-track their businesses. TechStars today announced an enhanced relationship with Microsoft through the new BizSpark Plus program for accelerators and incubators. The enhanced program allows TechStars accelerators in Boulder, Colo.; Boston; New York; Seattle; and Texas to offer each of their startups up to $60,000 (U.S.) of Windows Azure compute and storage over a 24-month period, at no cost. BizSpark Plus is an extension of the Microsoft BizSpark program, designed to accelerate the success of startups around the world. BizSpark Plus works through select incubators and accelerators such as TechStars to provide value-added products and services to high-potential startups. In addition to offering this to TechStars, Microsoft is making this offer available to all founders whose accelerator is part of the Global Accelerator Network, a network of nearly 40 high-quality accelerators from around the world that follow a model similar to TechStars. “Our passion is helping startups succeed around the world by providing funding and mentorship from the best and brightest Internet entrepreneurs and investors on the planet. The enhanced relationship with Microsoft will allow us to provide our founders with even more valuable support and services,” said David Cohen, founder and CEO of TechStars. “Access to technologies such as Windows Azure and other software and services from Microsoft through the BizSpark Plus program gives our companies a leg up in the all-encompassing race to scale and succeed.” TechStars has a wealth of experience working with tech startups around the world that are building products and services in the cloud. Cloud applications and smart devices are driving the new startup ecosystem, affording startups the ability to drive user adoption, scale their companies and generate financial returns with far less capital and much more quickly than ever before. Windows Azure offers a simple, comprehensive and powerful platform for the creation of Web applications and services. “TechStars is a great partner with a proven track record of attracting world-class startups. We are excited at the opportunity to work together to help startups when they need it most, with the products, resources and connections they need the most,” said Dan’l Lewin, corporate vice president, Strategic and Emerging Business Development, Microsoft. “Working with entrepreneurs on the forefront of the cloud revolution is especially rewarding. Windows Azure is a powerful, integrated platform, making it easy for startups to get their services up and running quickly with minimal overhead. This is the first offer from our new BizSpark Plus program, and we look forward to supporting TechStars members across a number of markets and technology offerings.” About TechStars TechStars (www.techstars.com) is an elite mentorship-driven start-up accelerator, recently recognized as the No. 1 accelerator program. Founded in 2006, the TechStars philosophy focuses on deep mentorship, and surrounding a small number of companies with highly engaged members of the entrepreneurial ecosystem to coach and support them to success. The TechStars community currently includes more than 300 mentors, more than 1,500 investors and over 120 alumni TechStars companies. TechStars currently operates five programs each year in Boulder, Boston, Seattle, Texas, and New York. TechStars is funded by more than 50 venture capital firms and 25 angel investors. Information on applying to TechStars can be found at www.techstars.com/apply. About Global Accelerator Network The Global Accelerator Network (www.joingan.com) consists of almost 40 high quality independently owned and operated organizations from around the world that utilize a mentorship-based startup accelerator model. It provides networking opportunities, training, special perks, and ongoing support for members of the network. TechStars led the effort to form the Global Accelerator Network in 2010 as part of the White House’s Startup America Initiative. In the spirit of supporting more entrepreneurs around the world, the Network’s mission is to ensure that 5,000 successful and experienced entrepreneurs and investors will mentor and support 6,000 promising young entrepreneurs. The goal is to increase their success rate tenfold and create 25,000 new jobs by 2015 as well as a sustained engine for growing these figures over time. About Microsoft BizSpark Microsoft BizSpark is a global program that helps software startups succeed. With more than 45,000 startups from 100 countries in the program and a global network of 2,300 BizSpark partners, Microsoft provides great business value to young technology companies around the world. The program provides a wide range of Microsoft technology, technical and business expertise, and enhanced market visibility. BizSpark Plus is an extension of the foundational BizSpark program, providing higher-value offerings through a network of leading regional incubators and accelerators around the world. More information is available at http://www.microsoft.com/bizspark. About Microsoft Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.