L&H buys speech rival Dragon

Speech recognition software vendor Lernout & Hauspie (L&H) has snapped up arch-rival Dragon Systems in a deal worth about $600m (£378m) in stock.

The Belgian-based company said today it has signed an agreement to acquire US-based Dragon in a move that gives L&H the lion's share of the US voice recognition market. Dragon currently holds a 50 per cent share in the region.

L&H and Dragon will pool their resources, and work on projects to accelerate the use of speech and language in emerging and mainstream consumer markets.

In particular, L&H said it is keen to pursue new opportunities in areas such as handheld and mobile devices, automotive, Wap and data mining. The vendor said the merger will also help it meet the growing demand for speech and language applications in markets such as telephony and healthcare.

The increased research and development resources and combined intellectual properties should also enable L&H to create speech products that are more intuitive and user-friendly, and that appeal to a wider group of consumers.

L&H said the deal, which should be completed by the second half of this year, will provide it with 350 additional employees, 170 of whom are research scientists and development engineers.

Gaston Bastiens, L&H president and chief executive, said: "By combining our talent with Dragon, we are pooling some of the best speech and language minds in the industry to create speech solutions that are even more user-friendly and applicable for broader, more consumer-oriented markets than ever before."

"We should be able to speed our 'time to market' with existing projects that to date we have not had the resources to tackle."

Bastiens said in the near term, L&H would be able to accelerate its 'time to market' for its prototype handheld device, codenamed NAK, which uses voice recognition to send and receive email, surf the web and conduct ecommerce transactions.