$80 Million Nuance Acquisition to Boost Auto Connectivity
Bridging the gap between voice, on-board applications, and connected third-party applications and content, voice recognition expert Nuance Communicationsannounced today it is acquiring the Tweddle Connect business from privately held Tweddle Group for $80 million in cash.
Tweddle Connect provides a communication link between popular third-party applications and content and a car's electronic system, while integrating smartphone applications into the system.
The platform will be enmeshed into Nuance's Dragon Drive voice command system giving automakers a complete, "end-to-end" solution offering voice, natural language understanding, dialog management, expressive text-to-speech, in-car connectivity, apps, and content while allowing consumers the ability to "automatically connect to their favorite apps and services as soon as they enter the car."
Nuance expects the transaction to close in the third quarter with revenues contributed by the acquisition to be negligible. However, next year, Tweddle Connect is expected to generate approximately $25 million in non-GAAP revenue and to add approximately $13 million to cash flow from operations.
Nuance Mobile Executive VP and General Manager Michael Thompson said: "The strategic combination of Nuance and Tweddle Connect will greatly improve the ability to bring an important category of content - third party applications and web services - into connected car systems."
Nuance points to research showing the number of U.S. connected car subscriptions growing at a 30% compound annual growth rate from 16 million in 2012 to 53 million in 2017, noting estimates the global installed base of connected cars will reach 210 million by 2016.
Following Nuance's acquisition of Tweddle Connect, the parent company Tweddle Group will continue "providing vehicle- and owner-related information and publishing solutions to automotive OEMs and their suppliers" as it has for the past 60 years.
The article $80 Million Nuance Acquisition to Boost Auto Connectivity originally appeared on Fool.com.Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool recommends Nuance Communications. The Motley Fool owns shares of Nuance Communications. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.