Activist investor, Carl Icahn boosted his stock-holdings in Nuance Communications Inc. (NASDAQ:NUAN) based on its latest regulatory filing with the Securities and Exchange Commission (SEC).
The activist investor and the funds he controls—such as Icahn Capital, Icahn Master, and Icahn Enterprises Holdings—reported a collective stake of 16.9% in the speech recognition and digital imaging company. Icahn previously owned 16.4% in Nuance Communications Inc. (NASDAQ:NUAN).
Carlson Capital's Double Black Diamond Fund posted a return of 3.3% net of fees in August, according to a copy of the fund's letter, which ValueWalk has been able to review. Q3 2021 hedge fund letters, conferences and more Following this performance, for the year to the end of August, the fund has produced a Read More
Icahn will likely demand to put a representative in the board of Nuance Communications Inc. (NASDAQ:NUAN). The activist investor has a reputation of using his stock-holdings in undervalued or poorly managed companies to push for changes.
The Federal Trade Commission (FTC) also approved Icahn’s transaction related to Nuance Communications Inc. (NASDAQ:NUAN), but the details are not yet available. The company’s stockholders rights plan took effect yesterday.
The activist investors first acquired a 9.3% passive position in the speech recognition and digital imaging company last April. At that time, analysts speculated that Icahn would push to split the company.
The following month, ValueWalk learned from sources with direct knowledge to the plans of Icahn that he would increase his stake in Nuance Communications Inc. (NASDAQ:NUAN) further to force a takeover of the company, or buy it outright. At that time, the company reported disappointing financial results, but initiated a share buyback program to show its confidence in the business and focus on shareholders’ value.
The management of Nuance Communications Inc. (NASDAQ:NUAN) immediately sought the advice of Goldman Sachs Group Inc (NYSE:GS), one of the go-to firms in Wall Street when corporations are under pressure from activist investors like Icahn.
During a conference call with investors early this month, Paul Ricci, chairman and CEO of Nuance Communications Inc. (NASDAQ:NUAN) said they are “committed to maintaining greater price discipline and to driving towards a focus on recurring revenues.” He added that the company is attentive of its recent executions and took a guarded approach to guidance.
Nuance reported a GAAP Net Loss
Nuance Communications Inc. (NASDAQ:NUAN) reported a GAAP net loss of $0.11 per share and $469.8 million revenue for its third quarter financial results. According to Ricci, the revenue of the company improved due to design wins and bookings. He said, “We continued to deliver innovative solutions and drive market penetration in strategic markets such as connected cars, voice-enabled televisions, healthcare revenue cycle management, mobile customer care and voice biometrics.”
The stock price of Nuance Communications Inc. (NASDAQ:NUAN) is up by more than 3% to $18.86 per share around 10:35 in the morning in New York on Friday.