Motorola, Inc. today announced it has entered into an agreement to acquire Kreatel Communications AB, a leading developer of innovative Internet Protocol (IPTV) based digital set-tops, headquartered in Linköping, Sweden. Terms of the deal were not disclosed.

Kreatel's Linux-based solution extends into the application and middleware layers, allowing it to be used with a broad set of middleware solutions. Kreatel's customer base includes such major service providers as Telefónica (Spain), TeliaSonera (Sweden), and KPN (The Netherlands).

This flexible set-top platform is a natural complement to Motorola's end-to-end digital video solution, and particularly addresses the growing need for IPTV based digital set-tops. Motorola offers flexible solutions throughout the cable, xDSL, and fiber-to-the-premise (FTTP) video chain - including network infrastructure, video headend and transport, industry-leading MPEG-4 encoding, and connected home devices.

"Combining Motorola and Kreatel's strengths is immensely attractive to green field video networks around the world and provides a critical solution as service providers evolve their video networks in the future," said Dan Moloney, president, Motorola Connected Home Solutions. "Motorola will have a flexible IPTV portfolio that addresses the real challenges faced by service providers worldwide as they build and evolve their networks."

Kreatel brings over six years' experience developing and delivering innovative IPTV set-top software and hardware solutions to European telecom operators and ISPs. The Kreatel team and IPTV technology will add another significant advantage for Motorola customers worldwide - augmenting the company's existing portfolio and providing significant flexibility for operators as they deploy video services.

"Current Kreatel customers - and others looking for a strong, flexible solution - will now achieve the benefits of working with a global leader in digital video," said Lars Bengtsson, CEO, Kreatel. "Motorola has an unmatched heritage of deploying and supporting video networks worldwide, and will enable more service providers to utilize the benefits of the Kreatel platform."

The agreement, which is subject to customary closing conditions, is expected to be completed during the first quarter of 2006. Kreatel's management team and employees will remain based in Linköping, Sweden, and be integrated into the Motorola Connected Home Solutions business.