Ericsson announced its agreement to
acquire Envivio (NASDAQ:ENVI), by means of a tender
offer for a price of USD 4.10 per share in cash, or
approximately USD 125 million in the aggregate. The
acquisition will strengthen Ericsson as a global
innovator in enabling customers to deploy new
technologies and agile video processing to innovate
new services that engage TV consumers every day.
The acquisition will strengthen
Ericsson's video compression position, combining its
leading position in broadcast and contribution with
Envivio's leadership in multiscreen cable and
telecom. Envivio's cloud-centric and software-based
video capabilities will be a key addition to
Ericsson's extensive portfolio of media enrichment,
processing, publishing, delivery, and TV platforms,
enabling TV experiences on any device.
Envivio is a global leader in
software-based video encoding with an installed base
of over 400 TV service provider and content owner
customers in all markets globally. Envivio generated
revenues of USD 43 million during full year 2014 and
is headquartered in San Francisco, CA. Envivio was
founded in 2000 and has a staff of approximately 200
employees worldwide.
Tier one Envivio customers include
Comcast, Cox Communications, Liberty Global, Sky,
Telstra and Time Warner Cable. Envivio's advanced
software solutions for pay TV and TV Anywhere
applications perform software-based video
encoding/transcoding, processing, packaging and ad
insertion. Envivio's cloud-centric pure software
video processing is available on Intel-based
appliances or IT blade servers.
Per Borgklint, Senior Vice
President and Head of Business Unit Support
Solutions at Ericsson, says: "Our consumer research
clearly shows that viewers are demanding TV on their
terms on any device, and expecting experiences that
continually evolve. 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."
The acquisition will greatly
enhance Ericsson's software video encoding
capabilities and its virtualized encoding concept,
which enables abstraction of video processing
functions from architectural and functional
boundaries, enabling the flexibility to use both
hardware and software based video compression, as
well as any deployment architecture.
Ericsson's customers will uniquely
benefit from a cutting-edge combination of market
leading bespoke hardware and highly optimized pure
software encoding that will deliver an accelerated
route to next generation UHD/HD services and
High-Efficiency Video Coding (HEVC) technology.
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
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 percent 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, 2015, subject to
customary closing conditions.
