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Nuance Communications has agreed to sell its Document Imaging division to automation software provider Kofax in a deal that is expected to be finalized sometime near the end of Nuance's second fiscal quarter early in the spring of 2019.

The move comes as Nuance looks to streamline its operations and focus exclusively on its conversational AI and cloud-based products, a transitional process that began last spring with the hiring of new CEO Mark Benjamin.

“Rather than competing for investments across a number of different technologies and markets and customer sets, we are going to be able to focus much more explicitly on our [business to business] customers,” said Richard Mack, Nuance's senior vice president of marketing and communications.

The deal has been a long time coming. According to Kofax CEO Reynolds Bish, the two companies have been talking about an acquisition in one configuration or another for almost eight years. At one point, there was even talk of Nuance acquiring Kofax.

“For a number of reasons, nothing ever happened,” Bish said.

The stars finally aligned after Benjamin took over in March and Nuance commenced an extensive operational review process aimed at determining the best opportunities for future growth.

Since the company was already deriving the majority of its revenue from products that incorporated some degree of conversational AI, natural language processing or voice related technologies, it seemed the natural way forward.

In other words, the document imaging division was up for grabs.

“That finally opened the door for a serious conversation about acquiring it, and at the end of all that we're very happy to be the winning bidder,” Bish said.

The sale will allow Kofax the opportunity to expand its technological portfolio to include scan-to-archive, scan-to-workflow, print management and capture capability on multi-function printers (MFPs).

An ability to offer capture on MFPs has become more important as companies—including law firms—have rolled out the digitization of paper across every level of their organization. Up until now, most of Kofax's products have been geared towards the financial services or medical field, but Bish is looking to take advantage of Nuance's position in the legal market.

“That's another opportunity for us to look at what else can we provide as part of a combined entity. What else can we bring to the legal marketplace in order to extend our relationships with those customers?” Bish said.

In addition to the sale of the imaging division, Nuance also plans to spin-off its automotive software component into an independent, publicly traded company by the end of fiscal 2019.

Products such as Nuance's Dragon voice recognition technologies, which Mack said have found a large market in the legal field, will continue to be produced as the company looks to develop new applications for AI.

“I think we're going to find greater synergy across our [research and development] investments and apply AI technology among a number of different customer sets,” Mack said.