Motorola, the world's No. 2 mobile phone maker, says it will buy Terayon Communication Systems for about $140 million in a move to amp up its video technology.

The deal, which would allow service providers to offer regional and local video content with possible digital advertising opportunities, is expected to close in the second or third quarter.

The Schaumburg, Illinois company said it would pay about $1.80 per share in cash for each share of Terayon. Excluding acquisition-related charges, the deal is expected to be neutral to Motorola's earnings per share in the year following the deal's closing.

Motorola, which is struggling with weakness in its mobile phone unit, has been beefing up its home video and network technology business in the last year as U.S. phone carriers have been launching Internet-based video services.

Last year, Motorola acquired video technology firms Vertasent, Broadbus Technologies and Kreatel. Since then, it acquired digital video technology developer Tut Systems, networking firm Netopia, handset maker Symbol Technologies and wireless e-mail company Good Technology.

Motorola Inc., the world's No. 2 mobile phone maker, said on Monday it will buy Terayon Communication Systems Inc. for about $140 million in a bid to boost its video technology.

The deal - the latest in a spate of Motorola acquisitions - would give it technology that lets service providers offer video based on regional and local interest and allows for the insertion of digital advertising and graphical overlays.

(Continue reading this story on Reuters)

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