Ericsson has tabled a $125 million offer for the software-based compression company Envivio.

In an IBC press briefing, Ericsson said the acquisition would enhance its existing virtualised encoding approach. “We want to extend our leadership in compression convergence to bring together hardware and software,” said Elisabetta Romana, vice president, TV & Media, Ericsson. “We are already leaders in compression and want to make it even bigger”.

Ericsson believes the combination will deliver an accelerated route to next generation UHD/HD services and High-Efficiency Video Coding (HEVC) technology.

Envivio’s customer base already reads like a roll call of some of the world’s top operators; Comcast, Cox Communications, Liberty Global, Sky, Telstra and Time Warner Cable. In all it has an installed base of over 400 TV service provider and content owners.

The company was founded in by Julian Singes in 2000 and has a staff of approximately 200 employees worldwide.

Envivio’s board of directors has unanimously approved the offer, which is expected to complete in the fourth quarter.

Once acquired the business will be reported as part of Segment Support Solutions.