Ericsson, which said it already holds 11.7 percent of Tandberg and has “irrevocable” acceptances for a further 13 percent of the shares, bid 106 Norwegian kroner (17.3 dollars, 13.1 euros) per share in cash.
The bid is 10.4 percent higher than the 96 kroner offered by US networks group Arris in mid-January.
The Swedish company said the bid was a “significant step toward (a) world leadership position in IPTV,” (Internet Protocol Television), which allows people to access television via the Internet or their mobile phone.
It added that Tandberg would expand its customer base to include cable and satellite operators as well as broadcasters.
“IPTV for cable and telecom operators is the biggest networked multimedia opportunity going forward,” Ericsson chief executive Carl-Henric Svanberg said in a statement.
A large part of the expected traffic growth in the world’s mobile and fixed networks is expected to be generated by television services, Ericsson said.
Tandberg is a world leader in encoding and compression technology, making it possible to maximize picture quality while minimizing bandwidth in video applications.
Revenues in 2006 were 350 million dollars. It has customers in more than 100 countries and has some 870 employees.
The bid values Tandberg at 8.9 billion Swedish kronor (1.26 billion dollars, 958.4 million euros) after deduction of net cash.