Convergence Integrated Media, headquartered in Berlin, is a 54-person company that works on software for digital TV set-top boxes. The acquisition, if it goes forward as planned, will raise Lineo's employee count to more than 400, said Lyle Ball, Lineo's vice president of communications.
The planned acquisition of Convergence would mark Lineo's seventh acquisition but not its last, Ball said. Through past acquisitions, the company has increased its employee count more than tenfold, Ball added.
The acquisition will give Lineo access to technology used to broadcast, transport and receive digital TV signals, Ball said. The software would be used in set-top boxes, electronic devices that offer more sophisticated computing capability and one of Lineo's key market pushes.
Lineo is one of a several companies pushing Linux into devices other than desktop computers. This "embedded" computing market for Linux already includes Red Hat, MontaVista Software, TimeSys, Coollogic and LynuxWorks.
But the company Lineo ranks as its biggest threat is Wind River Systems, which thus far prefers its own proprietary operating systems to Linux.
In May, Lineo filed plans for an initial public offering, but the company withdrew the plans in January. The company cited as reasons for the withdrawal unfavorable market conditions and the fact that it was required to disclose more information than it preferred to competitors.