Microsoft has agreed to acquire computer technology firm Nuance Communications in a $20 billion all-cash deal.
Microsoft will pay $56 a share for Nuance, a 23% premium to its Friday closing price. The deal values Nuance at around $19.7 billion, including around $1 billion in Nuance debt.
The deal is expected to close before the end of the year. It would be Microsoft's second-largest deal on record, after its $26 billion deal for Linkedin in 2016.
"Nuance provides the AI layer at the healthcare point of delivery and is a pioneer in the real-world application of enterprise AI," said CEO Satya Nadella. "AI is technology's most important priority, and healthcare is its most urgent application. Together, with our partner ecosystem, we will put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud in Healthcare and Nuance."