Adobe snaps up Macromedia for $3.4bn

Adobe has acquired Macromedia in a friendly takeover valued at $3.4bn.

Macromedia shareholders will receive 0.69 Adobe shares, currently valued at $60.66. Based on current share distribution this leaves Macromedia shareholders owning 18 per cent of Adobe.

"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," said Bruce Chizen, chief executive at Adobe.

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

Chizen will lead the new company, but Macromedia chief executive John Warnock will join the board. Redundancies should be expected by the time the deal is completed in the autumn.

In a separate move the Adobe board also announced its intention to buy back $1bn of stock.