The transaction is subject to various regulatory and other conditions and is expected to close within 120 days. The purchase price is subject to normal closing adjustments.

The acquisition includes Scientific-Atlanta's product lines for broadband satellite network gateways, data transactions, telephony, mobile asset tracking, automated meter reading, remote monitoring, and space imaging, as well as Scientific-Atlanta's satellite network operations center.

The transaction will enable Scientific-Atlanta to focus exclusively on its core business in broadband communications technology for new digital interactive services to consumer homes.

As a result of the acquisition ViaSat expects to more than double its revenues, with a majority of sales in commercial markets. ViaSat becomes a leading independent supplier of satellite ground networking equipment, and increases the resources it can apply to the emerging broadband- on-demand satellite ground equipment and services industry. ViaSat expects to finance the acquisition through an offering of debt or equity securities.

Upon closing, ViaSat will manage the combined commercial business unit, called ViaSat Satellite Networks, from Norcross, Georgia. Substantially all of the employees of the Scientific-Atlanta Satellite Networks business will be offered positions with ViaSat.

ViaSat will maintain its 180,000 square foot corporate headquarters facilities and other business lines in Carlsbad, California.

"While the satellite networking technologies we pioneered continue to be among the industry's best, the divestiture will enable Scientific-Atlanta to focus on our core strategy of providing consumers with broadband video, voice and data services," said Jim McDonald, president and CEO of Scientific-Atlanta.

"Scientific-Atlanta's broadband network and interactive set-top products are revolutionizing direct digital communications to consumers, while enabling network operators to generate new revenues. We want to keep our resources directed to the business," added McDonald.

ViaSat will also receive a related contract to study the benefits of combining Scientific-Atlanta's PowerVu digital video compression system with ViaSat patented Paired Carrier Multiple Access (PCMA*) to build an enhanced 2-way satellite interactive television system.

PCMA is a ViaSat technology for boosting the capacity of satellite systems by simultaneously transmitting both directions of a satellite circuit over the same bandwidth - which can significantly reduce the monthly costs of offering certain types of satellite services. With particular satellite architectures and services (such as telephony, videoconferencing, and many broadband digital data links) PCMA can double bandwidth efficiency, enabling satellite systems to support higher data rates, more subscribers, and lower transmission costs.

The system would offer digital television along with a low-cost interactive satellite return channel overlaid onto the same broadcast transponders.

If successful, this concept would establish an economical method of offering 2-way digital interactive direct-to-home TV services via satellite without requiring a separate dial-up telephone connection for the return path from the viewer. The transaction includes other supplemental agreements associated with the transitional relationship between the parties.

"This is an opportunity for both companies to enhance their strategic focus," said Mark Dankberg, chairman and CEO of ViaSat.

"We believe the Satellite Networks division we are acquiring will benefit in several ways by operating within a company that is tightly focused on this business. And we're gaining key people, technology, products, and distribution capabilities that extend our market reach and our ability to support our customers," added Dankberg.