RealTime IT News

SeaChange Liberates Overseas Assets

SeaChange will pay $25.5 million for Liberate Technologies' international assets, as it looks to pad offerings for digital cable network operators, the companies announced today.

The acquisition gives the Maynard, Mass., video-on-demand specialist applications to help cable companies run multiple services -- including high-definition television and personal video recorders -- on multiple platforms.

SeaChange will also receive a cache of patents and other intellectual property, as well as European customers NTL, Telewest and UGC. SeaChange will hire 20 Liberate engineers and field support technicians in San Mateo, Calif., and London.

"I'm very excited about the transaction," Bill Styslinger, SeaChange's president and CEO, said during a conference call with analysts. "It's one of the building blocks we've been hinting at."

The purchase fulfills two of his strategic goals. First, adding more software licensing revenues to the balance sheet. Liberate is expected to bring $12 million a year in revenue, Styslinger said. Second, increasing the amount of business the company generates overseas.

The deal requires the approval of Liberate shareholders and is expected to close in June or July. Liberate Chairman and CEO David Lockwood, who owns 12 percent of outstanding Liberate shares, has already committed his stake to the deal.

SeaChange and Liberate have previously worked as technology partners, which bodes well for a relatively smooth integration of their products, Styslinger said.

SeaChange's purchase comes at a time of consolidation in the cable industry. Large operators Comcast and Time Warner have reached a preliminary agreement to acquire failing rival Adelphia Communications for $17.7 billion.