diff --git a/docs/changelog.md b/docs/changelog.md
index 41a67fd7..690e7f56 100644
--- a/docs/changelog.md
+++ b/docs/changelog.md
@@ -2,9 +2,20 @@
 
 ### v0.13 - "*mind*"
 
+* Switch from libvips' C to C++ bindings, requires upgrade to v8.2.2.
+  [#299](https://github.com/lovell/sharp/issues/299)
+
 * Control number of open files in libvips' cache; breaks existing `cache` behaviour.
   [#315](https://github.com/lovell/sharp/issues/315)
 
+* Ensure 16-bit input images can be embedded onto a transparent background.
+  [#340](https://github.com/lovell/sharp/issues/340)
+  [@janaz](https://github.com/janaz)
+
+* Small optimisation when reducing by an integral factor to favour shrink over affine.
+
+* Add support for gamma correction of images with an alpha channel.
+
 ### v0.12 - "*look*"
 
 #### v0.12.2 - 16<sup>th</sup> January 2016
diff --git a/package.json b/package.json
old mode 100755
new mode 100644
index 91fef593..6742734b
--- a/package.json
+++ b/package.json
@@ -47,11 +47,11 @@
     "vips"
   ],
   "dependencies": {
-    "bluebird": "^3.1.1",
+    "bluebird": "^3.1.5",
     "color": "^0.11.1",
     "nan": "^2.2.0",
     "semver": "^5.1.0",
-    "request": "^2.67.0",
+    "request": "^2.69.0",
     "tar": "^2.2.1"
   },
   "devDependencies": {
@@ -60,10 +60,10 @@
     "exif-reader": "^1.0.0",
     "icc": "^0.0.2",
     "istanbul": "^0.4.2",
-    "mocha": "^2.3.4",
-    "mocha-jshint": "^2.2.6",
+    "mocha": "^2.4.5",
+    "mocha-jshint": "^2.3.0",
     "node-cpplint": "^0.4.0",
-    "rimraf": "^2.5.0",
+    "rimraf": "^2.5.1",
     "bufferutil": "^1.2.1"
   },
   "license": "Apache-2.0",
diff --git a/src/metadata.h b/src/metadata.h
old mode 100755
new mode 100644
diff --git a/src/operations.cc b/src/operations.cc
index 1a6bb4f0..16fdec9e 100644
--- a/src/operations.cc
+++ b/src/operations.cc
@@ -102,11 +102,25 @@ namespace sharp {
     return image;
   }
 
+  /*
+   * Gamma encoding/decoding
+   */
+  VImage Gamma(VImage image, double const exponent) {
+    if (HasAlpha(image)) {
+      // Separate alpha channel
+      VImage imageWithoutAlpha = image.extract_band(0,
+        VImage::option()->set("n", image.bands() - 1));
+      VImage alpha = image[image.bands() - 1];
+      return imageWithoutAlpha.gamma(VImage::option()->set("exponent", exponent)).bandjoin(alpha);
+    } else {
+      return image.gamma(VImage::option()->set("exponent", exponent));
+    }
+  }
+
   /*
    * Gaussian blur (use sigma <0 for fast blur)
    */
   VImage Blur(VImage image, double const sigma) {
-    VImage blurred;
     if (sigma < 0.0) {
       // Fast, mild blur - averages neighbouring pixels
       VImage blur = VImage::new_matrixv(3, 3,
diff --git a/src/operations.h b/src/operations.h
index 3ce63036..ba69b25d 100644
--- a/src/operations.h
+++ b/src/operations.h
@@ -18,6 +18,11 @@ namespace sharp {
    */
   VImage Normalize(VImage image);
 
+  /*
+   * Gamma encoding/decoding
+   */
+  VImage Gamma(VImage image, double const exponent);
+
   /*
    * Gaussian blur. Use sigma of -1 for fast blur.
    */
diff --git a/src/pipeline.cc b/src/pipeline.cc
index c1d65c84..b5340d12 100644
--- a/src/pipeline.cc
+++ b/src/pipeline.cc
@@ -43,6 +43,7 @@ using vips::VError;
 
 using sharp::Composite;
 using sharp::Normalize;
+using sharp::Gamma;
 using sharp::Blur;
 using sharp::Sharpen;
 
@@ -425,7 +426,8 @@ class PipelineWorker : public AsyncWorker {
       }
 
       // Calculate maximum alpha value based on input image pixel depth
-      double maxAlpha = (image.format() == VIPS_FORMAT_USHORT) ? 65535.0 : 255.0;
+      bool is16Bit = (image.format() == VIPS_FORMAT_USHORT);
+      double maxAlpha = is16Bit ? 65535.0 : 255.0;
 
       // Flatten image to remove alpha channel
       if (baton->flatten && HasAlpha(image)) {
@@ -449,8 +451,8 @@ class PipelineWorker : public AsyncWorker {
       }
 
       // Gamma encoding (darken)
-      if (baton->gamma >= 1 && baton->gamma <= 3 && !HasAlpha(image)) {
-        image = image.gamma(VImage::option()->set("exponent", 1.0 / baton->gamma));
+      if (baton->gamma >= 1 && baton->gamma <= 3) {
+        image = Gamma(image, 1.0 / baton->gamma);
       }
 
       // Convert to greyscale (linear, therefore after gamma encoding, if any)
@@ -541,10 +543,6 @@ class PipelineWorker : public AsyncWorker {
       // Crop/embed
       if (image.width() != baton->width || image.height() != baton->height) {
         if (baton->canvas == Canvas::EMBED) {
-          // Add non-transparent alpha channel, if required
-          if (baton->background[3] < 255.0 && !HasAlpha(image)) {
-            image = image.bandjoin(VImage::black(image.width(), image.height()).invert());
-          }
           // Scale up 8-bit values to match 16-bit input image
           double multiplier = (image.interpretation() == VIPS_INTERPRETATION_RGB16) ? 256.0 : 1.0;
           // Create background colour
@@ -557,6 +555,12 @@ class PipelineWorker : public AsyncWorker {
           if (baton->background[3] < 255.0 || HasAlpha(image)) {
             background.push_back(baton->background[3] * multiplier);
           }
+          // Add non-transparent alpha channel, if required
+          if (baton->background[3] < 255.0 && !HasAlpha(image)) {
+            VImage alpha = VImage::new_matrix(image.width(), image.height())
+              .new_from_image(baton->background[3] * multiplier);
+            image = image.bandjoin(alpha);
+          }
           // Embed
           int left = static_cast<int>(round((baton->width - image.width()) / 2));
           int top = static_cast<int>(round((baton->height - image.height()) / 2));
@@ -639,11 +643,17 @@ class PipelineWorker : public AsyncWorker {
       // Reverse premultiplication after all transformations:
       if (shouldPremultiplyAlpha) {
         image = image.unpremultiply(VImage::option()->set("max_alpha", maxAlpha));
+        // Cast pixel values to integer
+        if (is16Bit) {
+          image = image.cast(VIPS_FORMAT_USHORT);
+        } else {
+          image = image.cast(VIPS_FORMAT_UCHAR);
+        }
       }
 
       // Gamma decoding (brighten)
-      if (baton->gamma >= 1 && baton->gamma <= 3 && !HasAlpha(image)) {
-        image = image.gamma(VImage::option()->set("exponent", baton->gamma));
+      if (baton->gamma >= 1 && baton->gamma <= 3) {
+        image = Gamma(image, baton->gamma);
       }
 
       // Apply normalization - stretch luminance to cover full dynamic range
diff --git a/src/pipeline.h b/src/pipeline.h
old mode 100755
new mode 100644
diff --git a/test/fixtures/expected/embed-16bit-rgba.png b/test/fixtures/expected/embed-16bit-rgba.png
new file mode 100644
index 00000000..70e3f365
Binary files /dev/null and b/test/fixtures/expected/embed-16bit-rgba.png differ
diff --git a/test/fixtures/expected/gamma-alpha.jpg b/test/fixtures/expected/gamma-alpha.jpg
index 08b54565..aabde8a9 100644
Binary files a/test/fixtures/expected/gamma-alpha.jpg and b/test/fixtures/expected/gamma-alpha.jpg differ
diff --git a/test/unit/embed.js b/test/unit/embed.js
index aa4e30cd..bc4032ea 100644
--- a/test/unit/embed.js
+++ b/test/unit/embed.js
@@ -80,6 +80,21 @@ describe('Embed', function() {
       });
   });
 
+  it('16-bit PNG with alpha channel onto RGBA', function(done) {
+    sharp(fixtures.inputPngWithTransparency16bit)
+      .resize(32, 16)
+      .embed()
+      .background({r: 0, g: 0, b: 0, a: 0})
+      .toBuffer(function(err, data, info) {
+        if (err) throw err;
+        assert.strictEqual(true, data.length > 0);
+        assert.strictEqual('png', info.format);
+        assert.strictEqual(32, info.width);
+        assert.strictEqual(16, info.height);
+        fixtures.assertSimilar(fixtures.expected('embed-16bit-rgba.png'), data, done);
+      });
+  });
+
   it('Enlarge and embed', function(done) {
     sharp(fixtures.inputPngWithOneColor)
       .embed()