Adobe Systems, Inc. on Friday announced it is acqiring arch-rival Macromedia, Inc. in an all stock transaction valued at approximately $3.4 billion.

The two companies had previously been locked in a bitter rivalry in the creative professional software market. Adobe, best known for its Photoshop image manipulation and Acrobat digital document software, said the move would help it offer audio and video solutions more tailored to the mobile media market. The acquisition gives it access to Macromedia’s hugely popular Flash software, which is used to deliver animation and video on the Web.

Under the terms of the deal, Macromedia shareholders will get 0.69 share of Adobe, worth $41.86 at Adobe’s closing price of $60.66 on Friday on Nasdaq, for each Macromedia share. That is a 25 percent premium to Macromedia’s closing price of $33.45 on Friday, also on Nasdaq.

Chizen will stay in his position as CEO, Adobe said, while Macromedia President and CEO Stephen Elop will become president of worldwide field operations at the combined company.

The deal is expected to be completed this Autumn.