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Envivio, a provider of software-based video processing and delivery solutions, is to be acquired by Ericsson in a deal worth $125 million.
“The uniting of Envivio’s pioneering software solutions and Ericsson’s strength in the marketplace is a great combination for our customers and stockholders,” said Julien Signès, founder and CEO of Envivio. “Ericsson shares a similar vision for the future of video processing and shift to software defined and virtualised encoding solutions. Ericsson brings tremendous resources, a broad product and solutions portfolio and reach that will accelerate the adoption of Envivio’s software-based video solutions.”
As part of Ericsson’s TV and Media business, Envivio will continue to work with its customers and partners to develop its current software based video solutions for video processing, delivery and monetisation. Envivio’s customers will be able to rely on the global stability and scale and the strong commitment of Ericsson in the TV and Media business with access to Ericsson’s full portfolio of products, solutions, and global services expertise.
“Our consumer research clearly shows that viewers are demanding TV on their terms on any device, and expecting experiences that continually evolve,” said Per Borgklint, Senior Vice President and Head of Business Unit Support Solutions at Ericsson. “We are committed to offering our customers a clear path towards fully agile cloud agnostic platforms that delight TV consumers. I look forward to welcoming the market leader in pure software-defined video encoding, processing, and packaging into Ericsson. The combination will strengthen our encoding position with both custom silicon and pure software encoding, delivering performance and flexibility.”
Under the terms of the definitive agreement, Ericsson will commence a cash tender offer to purchase all of Envivio’s outstanding shares, with a merger following the completion of the tender offer which would result in all shares not tendered in the tender offer being converted into the right to receive $4.10 per share. Certain of Envivio’s major stockholders, collectively owning approximately 34 per cent of Envivio’s outstanding common stock, have entered into a tender and support agreement with Ericsson committing to tender all of their Envivio shares in the tender offer and to vote in favor of the merger. The acquisition is expected to close in the fourth quarter of 2015, subject to customary closing conditions.
The board of directors of Envivio has unanimously agreed to recommend that Envivio’s stockholders tender their shares to Ericsson in the tender offer.