The deal was worth about $16 billion and about $19 billion with debt. The deal priced shares of NUAN at $56 per share, 23 percent more than the closing price Friday. Microsoft has been actively working to grow its software offerings with acquisitions. The company is also in talks to buy chat app Discord for around $10 billion and attempted to purchase TikTok for $30 billion last year.

This is Microsoft's largest acquisition since it bought LinkedIn for $26 billion in 2016. Shares of Nuance surged Monday while Microsoft shares rose slightly. Nuance's main revenue stream comes from recognizing and transcribing speech in doctor office visits, customer-service calls, and voicemails. Microsoft plans to use Nuance's offering to augment its cloud products for healthcare.

Here's what Microsoft CEO Satya Nadella said about the deal early Monday morning.

“We’ve seen a massive acceleration of digital transformation… health care in particular,” Nadella said. “When you think about the provider market… digital tech is going to be the key.”

Nuance CEO Mark Benjamin will remain in place at the company but report to Scott Guthrie, the lead of Microsoft's cloud and artificial intelligence business.

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