Smith Micro said it will pay US$11 million in cash and $1.75 million in Smith Micro shares to purchase all outstanding shares of Allume.
Allume recently announced the development of a new JPEG compression technology that reduces the size of JPEG images up to 30% in size without any additional reduction of image quality. The company is planning to expand the technology to provide similar compression for MPEG and MP3 files. This technology plays directly into Smith Microis strategy of broadening its wireless product offerings and provides for the first time to carriers and handset manufacturers enhanced compression technology that could reside directly in the handset.
Aladdin Systems changed its name to Allume Systems in July of 2004 after the settlement of a trademark lawsuit with Aladdin Knowledge Systems.