Companies that suffer a major financial set-back – in the case of Kurzweil Applied Intelligence Inc, it was fraudulent inflating of quarterly reports – seldom get back into their stride, no matter how sound the fundamental business and product line. Now Belgian firm Lernout & Hauspie Speech Products NV of Ypres has a definitive agreement to buy Kurzweil for about $53m. After the acquisition, Lernout will work with Kurzweil to develop the Holy Grail of speech recognition – a large vocabulary speaker- independent continuous dictation engine. It believes the joint- effort will help accelerate the introduction of continuous speech dictation products by about six months. Lernout will be paying 80% in cash, 20% in newly-issued Lernout shares. The company is also in talks with the Dictation Consortium, a Flanders Language Valley Foundation investment dedicated to automatic speech recognition, for it to participate in the acquisition, paying Lernout up to $26m from income from 1998 products.
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