Harmonic Inc. has entered into an agreement to acquire the video networking software business of Entone Technologies Inc. for $45 million.
Entone, a privately held company based in San Mateo, Calif. with research and development facilities in Hong Kong, has software that manage and stream personalized video services including video-on-demand, network personal video recording, time-shifted television and targeted advertisement insertion.
By combining Sunnyvale, Calif.-based Harmonic's video headend, edge and access network solutions with Entone's on-demand software, Harmonic will be able to provide cable, satellite and telco/IPTV service providers a next-gen integrated delivery system with both broadcast and personalized IP-delivered video services.
"Our industry is in the midst of an exciting and fundamental transformation to an increasingly on-demand video experience," said Patrick Harshman, president and CEO of Harmonic Inc. "In the cable and satellite markets, where Harmonic enjoys strong customer relationships and a large installed base, this comprehensive solution will be a great benefit to our customers as they expand and extend their offerings with new on-demand services."
The $45 million deal includes $26 million in cash and the value of about 3.54 million shares of Harmonic common stock. Harmonic will also assume certain liabilities of $1.5 million and invest $2.5 million in the form of a convertible note in Entone's consumer premise equipment business.
The merger is subject to customary closing conditions. Closing is anticipated to take place in October 2006.
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