Carl Icahn’s Ulterior Motive: He Might Want Apple To Buy Nuance

Apple-Siri

Investment tycoon Carl Icahn has been bullish on Apple lately. In mid-August, Icahn unexpectedly tweeted that Icahn Enterprises, his diversified holding company, believed Apple to be “extremely undervalued.” Immediately, share prices jumped 5.6%. The next week, Icahn announced on Twitter that he and Tim Cook would be meeting in September to discuss a larger buyback program of AAPL shares.

That’s all nice, but Icahn is a business magnate, not an Apple fanboy. So what the heck is he up to here? A new theory being put forward by some investors is that Icahn has ulterior motives for his sudden Apple love affair: he wants Apple to buy Nuance, a company Icahn has a large stake in.

Some background information. Nuance is the company that provides the voice-recognition technology that powers Siri, Apple’s virtual assistant for iOS. In May, Nuance’s CEO confirmed that Nuance powers Siri, although despite many sloppy claims to the contrary, this has been public knowledge for a long time: Apple had copped to it on their official website long before.

The thinking goes that Apple might consider itself overly dependent upon Nuance, which sells other voice-recognition solutions to other software providers (like Android) and even makes the popular Dragon Dictate voice-recognition software for PC or Mac. Apple doesn’t like being too reliant on an outside vendor, so the theory is that Apple should buy Nuance to bring Siri’s core-tech in house for around $7 billion… a mere pittance in Cupertino’s war chest.

That would be a good thing for Carl Icahn, who owns a 16.9% stake in the company. “Nuance is a leader in voice. Voice is the future. Apple needs to expand its future,” says hedge-fund consultant Charles Gradante. Icahn, then, might be in-love with Apple right now because he’d stand to benefit if the shares of both Apple and Nuance were pushed as high as possible before the deal goes through.

What do you think? Is Icahn just an Apple fan, or will he be suggesting to Tim Cook over dinner in September that Apple could do worse than pony up $7 billion for Nuance? Let us know in the comments.

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  • Zod Buster

    this guy is a main player in the Rigged Casino…all with the blessings of the SEC and the Obama Administration…

  • Bulldogger123

    this guy is a main player in the Rigged Casino…all with the blessings of the SEC and the Obama Administration…

    So you’re saying that the “Rigged Casinos” started with the Obama Administration? This all started under Bush, so get your facts straight! Whether Obama’s hand has been forced to go along because of a faltering economy is certainly up for debate, but don’t purposely mislead.

  • kaboomnik

    Just wanna say, I hate Nuance with a passion. I spent a fortune trying to get their Mac products to work, and they simply gave the crappiest customer support in history (and I’ve seen some crappy customer support in my time).

  • efforting

    I find it offensive that guys like this can make a fortune out of thin air based on deception and manipulation without actually contributing anything tangible to society.

  • JesusHSmith

    Is Nuance really worth 7 billion? They’re a pony with a good trick, but it’s still only one trick.

  • m_hardwick

    Apple won’t buy Nuance… They might buy a very specific portion of the Nuance product portfolio – but Nuance is itself all about acquisitions and they have a strong portfolio of document management products – in which Apple has zero interest. Also Nuance are an awful company who don’t really care about the products or customers (that seems to ring true with most companies that buy in skills and technology/products rather than develop it themselves). Being an eCopy and a Dragon enterprise customer is all the proof I need to know that Nuance shouldn’t be touched with a barge pole.

About the author

John BrownleeJohn Brownlee is a Contributing Editor. He has also written for Wired, Playboy, Boing Boing, Popular Mechanics, VentureBeat, and Gizmodo. He lives in Boston with his wife and two parakeets. You can follow him here on Twitter.

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