Amino Technologies, the Cambridge-based digital entertainment company, has conditionally agreed to acquire a US-based competitor in a deal worth $73m (£46.7m).
Entone, which also has offices in Belgium and Hong Kong, is a provider of broadcast hybrid TV and connected home services with more than 150 global customers.
The company had revenues of $43.4m (£27.9m) in the fiscal year ended 30 June 2014 and EBITDA of $3.9m (£2.5m)
Amino, which is proposing to raise £21m through a conditional placing of more than 16 million shares, will pay an initial sum of $65m (£41.6m) in cash and a deferred consideration of $8m (£5.1m).
Chief executive Donald McGarva said: "The proposed acquisition of Entone has the potential to transform our business and broaden our capabilities and market reach globally across IPTV, hybrid broadcast and a range of connected home solutions."
"We anticipate a number of synergies between the two companies and expect the proposed acquisition to be earnings enhancing in the first full year of combined operations," he added.
Amino has this morning (21 July) posted its financial results for the six months ended 31 May 2015. Revenues grew from £16.4m to £17.9m and operating profits rose to £3.6m from £1.8m.
Non-executive chairman Keith Todd said: "Today's results mark a real turning point for Amino. Following a significant amount of hard work, and thanks to a clear and well thought-out strategy, our business has reignited its organic revenue growth, extended its margins and profitability, and begun to put in place some very exciting building blocks for the future."