Good News:
Warburg Pincus Agrees to Purchase Entire ScanSoft Equity Position Held by Xerox for Approximately $80 Million
Global Private Equity Firm to Purchase 15.9 Million Shares Held by Xerox Corp.; William Janeway, a Warburg Pincus Vice Chairman, to Join ScanSoft Board of Directors
PEABODY, Mass., March 19, 2004 - ScanSoft, Inc. (Nasdaq: SSFT), the leading supplier of speech and imaging solutions, today announced that Warburg Pincus has agreed to purchase all outstanding shares of ScanSoft stock held by Xerox Corporation (NYSE: XRX) for approximately $80 million. Warburg Pincus, the global private equity firm and a leading technology investor, has been a lead investor in premier enterprise communications and software companies such as Avaya Inc. (NYSE: AV), BEA Systems (Nasdaq: BEAS) and VERITAS Software (Nasdaq: VRTS).
"We are impressed with ScanSoft's business strategy, market-leading solutions and worldwide capabilities," said William H. Janeway, a Warburg Pincus vice chairman who will join ScanSoft's board of directors. "We have followed the company's progress for several years and are enthusiastic about its potential for continued growth. We believe that ScanSoft has the vision and resources to extend its position as the leading provider of global speech and imaging solutions."
Xerox and Warburg Pincus reached an agreement today for the private equity firm to acquire the entire Xerox holding, comprising 11,853,602 shares of ScanSoft's common stock; 3,562,238 shares of non-voting Series B preferred stock; and a warrant to purchase up to 525,732 shares of common stock. In addition, Warburg Pincus has acquired a warrant to purchase 2.5 million shares of common stock from ScanSoft.
"ScanSoft's success represents the effective monetization of Xerox innovation. It has grown from an imaging application developed in Xerox research labs to a robust company that is expanding its market reach," said Lawrence A. Zimmerman, Xerox senior vice president and chief financial officer. "Xerox's decision now to sell our ownership stake in ScanSoft is aligned with our strategy to focus investments in areas related to Xerox's document management core business. Although Xerox will no longer maintain an equity position in ScanSoft, we plan to continue working with the company as a business partner and application provider."
"Warburg Pincus is renowned for helping enterprise software companies reach new levels of achievement, as evidenced in its portfolio companies," said Paul Ricci, chairman and CEO at ScanSoft. "We are proud to have Warburg Pincus as a significant investor and partner in our growth and especially pleased to welcome William Janeway to our board of directors." |
