Competition watchdog launches probe into Microsoft’s £12bn Nuance deal

Microsoft could face questions from the UK’s competition watchdog over what is meant to be the technology giant’s second largest takeover.

The Competition and Markets Authority said on Monday that it has launched a probe into the 16 billion dollar (£12 billion) acquisition of Nuance Communications.

Nuance specialises in artificial intelligence and speech recognition. It helped develop Apple’s Siri voice assistant.

Despite both companies being based in the US, the British regulator could wade into the deal if it finds that it will have a bad impact on the UK markets.

However, how likely it is to find any problems remains to be seen.

Regulators in the US and Australia have already given Microsoft the thumbs up, while Brussels is reportedly on the verge of giving approval, according to a report by Reuters.

“The CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation,” the watchdog said on Monday.

It added: “To assist it with this assessment, the CMA invites comments on the transaction from any interested party.”

The response window will be open until January 10, after which the watchdog will consider its options.

If the regulator finds any problems in the deal, it could block it until the companies are willing to meet certain conditions.

An attempt like that would not be the first time the UK regulator stepped in to block a deal between two US companies.

Facebook’s parent company, which was recently renamed Meta, bought Giphy for about 400 million in 2020.

But last month the CMA ordered Meta to sell the Gif-maker, because it found that the tie-up had the potential to harm UK social media users and reduce competition between social media platforms.

Meta said that it disagreed with the decision, and might appeal against the regulator’s order.

“We are reviewing the decision and considering all options, including appeal. Both consumers and Giphy are better off with the support of our infrastructure, talent, and resources.”