Verint's software analyzes voice, pictures and other data. Earlier this month, IBM announced its entry into this market with a service product that it claimed offered the most advanced digital surveillance technology, code-named S3.

It said its new digital video surveillance service product used its hardware, software, research and services to enable real-time access to critical security information, providing businesses the ability to detect patterns or search for particular attributes and alert authorities of any suspicious or anomalous behavior.

Verint is currently trading strongly with sales in its second quarter to July 31 up 23.5% to $92.3m. However, the company is 57% owned by Comverse Technology Inc, which is at the center of a huge options fraud case.

As Verint employees received Comverse options before it was spun out in 2002, it has had to set up a special committee to investigate the issue. It is currently behind with its Nasdaq filings and has been threatened with delisting by the stock exchange.

This black cloud hanging over the company has depressed its share price and its current value of $1bn may tempt IBM into acquiring the means to boost its entry in the video surveillance market.