Arris Group (ARRS) has agreed to acquire BigBand Networks (BBND) for $2.24 a share, about a 75% premium to its smaller rival’s closing price on Monday, as it continues to convert to an all IP-converged network architecture.

The price equates to an equity value of about $172 million, or $53 million excluding BigBand’s estimated cash on hand. With a market capitalization of $156.4 million, Redwood City, Calif.-headquartered BigBand develops network-based platforms worldwide.

The deal is expected to expand Arris’ capabilities in the processing, management and distribution of digital video content. Arris, whose shares were down about 2% on the news, is based in Suwanee, Ga., and manufactures equipment for the broadband communication industry.

The company said the additional technologies and R&D investments of BigBand are expected to “accelerate time-to-market and increase opportunities for Arris in several fast growing product areas.”

BigBand’s portfolio includes its converged cable access platform, CableLabs architecture, local and targeted advertising, video distribution and advanced video compression.

If the deal is approved, Arris said it would optimize BigBand’s financial performance through operational synergies, such as eliminating its public-company costs, and aligning sales and R&D.

The acquisition will be conducted through a tender offer for all of BigBand’s outstanding shares.

The offer is expected to start within 10 business days and will be subject to customary closing conditions, including the acquisition by Arris of a majority of BigBand’s shares and the receipt of antitrust clearance.

BigBand’s board has unanimously recommended the deal and encouraged shareholders to tender their shares. Redpoint Ventures and ValueAct Capital Partners, which together hold 32% of BigBand’s shares, have agreed to vote in favor of the agreement and against any other transaction.

The deal is slated to close later this year.

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