Macromedia, creator of the Flash development platform, dreamweaver and a host of other tools, is to be acquired by Adobe. The values Macromedia at $3.4bn.

Adobe's rationale is a more powerful offering to customers for creating, managing and delivering content. Expansion into new markets including mobile and enterprise segments is on the cards.

Bruce Chizen, Adobe chief executive officer, said "Customers are calling for integrated software solutions that enable them to create, manage and deliver a wide range of compelling content and applications - from documents and images to audio and video"

"By combining our development, authoring and collaboration software - along with the complementary functionality of Adobe PDF documents and Macromedia Flash - Adobe has the opportunity to bring this vision to life with an industry-defining technology platform."

Adobe, admit the primary reason is strategic, for growth into new markets. However they are expecting some cost savings through synergies.

Both boards have agreed the deal. Regulatory and shareholder approval is then needed. Completion is not expected untilt the Autumn.

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