Facebook has acquired LiveRail, a platform which connects companies with video advertising slots on the web and mobile devices, for somewhere between $400m and $500m, according to reports.

Facebook has remained tight-lipped about the amount it paid, but it is understood to be somewhere in that price range, as reported by TechCrunch.

LiveRail says it delivers more than seven billion video ads per month through its platform, which operates a real-time bidding platform for companies like Major League Baseball, ABC Family, A&E Networks, Gannett and Dailymotion.

"We believe that LiveRail, Facebook and the premium publishers it serves have an opportunity to make video ads better and more relevant for the hundreds of millions of people who watch digital video every month," Brian Boland, vice-president of ads product marketing and atlas at Facebook, said in a blog post.

"LiveRail's excellent product – known in the industry as a video supply-side platform or SSP – and Facebook's expertise with relevancy, delivery and measurement will help us make video advertising much better for everyone."

LiveRail, which was started up in 2007, has reportedly been generating annual revenues close to $100m and considering an IPO later in 2014.

"We realised that by joining forces we'd be able to draw upon our respective strengths to move even faster towards our shared vision of creating the advertising platform of the future," Mark Trefgarne, CEO and cofounder of LiveRail, said in a blog post.

The acquisition comes at a time when Facebook and Twitter are looking to attract more advertisers to their websites, amid an expected surge in mobile ad spending.

Twitter acquired mobile advertising exchange MoPub in 2013.