The acquisition will allow Wind River, an embedded software company, to enable manufacturers of consumer electronic products -- including Internet appliances such as web pads and screen phones, Digital TVs, set-top boxes and web-based business terminals -- to incorporate web browsing and secure transaction functionality into their products.

The transaction will be accounted for as a purchase, and it is expected to be moderately dilutive to earnings this fiscal year, and accretive to earnings by the end of next fiscal year.

"The era of smart, connected devices is just beginning," said Tom St. Dennis, president and chief executive officer of Wind River. "Already millions, and very soon even billions, of devices will be connected to the Internet. Many of these devices will need Internet browsing capabilities. ICESoft provides a world-class technology that will enable us to bring to market the industry's most complete Internet appliance solution."