Yahoo has been building up its video and video advertising content, and we have heard that it may make another key acquisition in the area to further raise its game. The company is in talks to acquire BrightRoll, the cross-platform digital video advertising service.

TechCrunch has heard that term sheets have been signed, and that the price, if the deal is completed, could be anywhere from $500 million to $1 billion, but looks likely to be in the region of $700 million – $725 million.

Yahoo is currently under pressure from activist investor Starboard Value to consider a breakup and/or sale of the company. This could potentially have an impact on negotiations. Tim Armstrong, the CEO of AOL — Starboard’s target for a merger — earlier today said that a Yahoo sale does not figure as part of AOL’s future plans.

Were a BrightRoll acquisition to go through, you can see Yahoo’s logic: BrightRoll is a strong competitor against the likes of Google and its leading online video property YouTube when it comes to video ad volumes and attracting publishers and advertisers.

BrightRoll’s platform — which works across web, mobile and connected TV devices — acts as an intermediary and service for both advertisers and publishers. Advertisers plan, target, optimise and report digital video ad campaigns, while publishers plug BrightRoll ad inventory into their content.

Its platform is one of the biggest of its kind: “#1 in ads served and largest reach to unique video viewers,” according to comScore in June 2014, and as pointed out by BrightRoll itself. The company works with 25 of the top 50 publishers, and 85 of the top 100 advertisers.

Meanwhile, Yahoo is in a period of change. Under CEO Marissa Mayer, the company has made more than 30 acqui-hires of smaller startups to bring more talent to the company, in part to build out a stronger mobile business. But according to a report in the WSJ, Yahoo, now flush with post-IPO Alibaba cash, will shift its acquisition strategy.

Going forward, Yahoo’s acquisitions will be more in the Tumblr model: focusing on companies that build up Yahoo’s product and revenue-generating muscle. That’s crucial, given that the company has seen several recent quarterly sales declines.

BrightRoll — estimated in 2013 to be “easily doing over $100 million in revenue” and a clear video play that could help monetise Yahoo’s long-term ambition to grow and make money from its video content — could fit the bill.

According to CrunchBase, BrightRoll has raised just over $40 million from investors that include Adams Street Partners, Scale Venture Partners, Comerica Bank, True Ventures, Trident Capital, KPG Ventures, Michael Tanne, Fabrice Grinda, Auren Hoffman and Jeff Clavier.

BrightRoll CEO Tod Sacerdoti would comment for this story. We have reached out to Yahoo for a comment and will update if we get a response.