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Who’s Next On Pace’s M&A Hit List?

Pace is shelling out $310 million to acquire Aurora Networks, a move that will give the U.K.-based set-top maker a chance to diversify its business and add some network-side pieces to the puzzle that it failed to get when it failed to land an even bigger fish, Motorola Home.

Pace CEO Mike Pulli told me last week that his company would be on the lookout for more acquisitions, if thos targets  were financially attractive and helped Pace expands its software and services business.

He wouldn’t identify any candidates, of course, so we’ll speculate on a couple that could make sense.

  1. TiVo  

While TiVo’s known for its DVR hardware, a lot of the company’s value is tied to its user interface and underlying software ecosystem – pieces that would be very complementary to Pace. And the companies are not strangers, as Pace has already been porting the TiVo UI to boxes tagged for distribution by several cable operators, including Mediacom Communications.

And sources have tied the two companies to M&A talks in recent months, though there’s no indication that a deal is imminent. There’s some disagreement on who would be the buyer or the seller (TiVo’s got $1 billion in the bank), but the two would seem to make a good match, as both are in need of solidifying their respective, longer-term growth strategies.

  1. SeaChange International

It’s been no secret that SeaChange International has been seeking a suitor for years, and the company has become increasingly attractive after it shed some non-core assets (i.e. On Demand Group, and its broadcast server and storage unit) and morphed itself into more of a pure-play software company with a portfolio that now includes multiscreen user interfaces, video backoffice, and advanced advertising systems. In fact, we’ve heard that both TiVo and Rovi Corp. have poked around, though nothing difinitive has come out of those M&A talks yet.

And that could be partly due to the fact that SeaChange is anything but a steal these days. On Friday (October 25), its stock closed at $14.83 each, not far below its 52-week high of $15.25. So, SeaChange’s assets are apparently attractive to potential suitors, but the price tag might be a tad rich to drive any deals in the near-term.

And those are just two possible options for Pace. Who else might make sense for Pace? Chime in below.