UPDATED: Nokia to buy Navteq

Nokia has launched an audacious $8.1 billion (ï4.05 billion) cash takeover bid for satellite navigation map maker Navteq, in order to gain a foothold in the navigation industry and add new functionality to its phones.

The deal is the largest takeover attempted by Nokia.

Nokia and Navteq were deep in talks on Sunday night, and have been in discussions over the past few weeks, but it was still possible the talks could crumble over last-minute issues.

Nokia declined to comment, and Navteq was not immediately available for comment.

It remains unclear how the takeover will affect Navteq's existing business, which is based on licensing its maps to hardware manufacturers, including companies that compete with Nokia.

"In the longer perspective it is good for Nokia, but it could dent the shares in the near term," said eQ analyst Jari Honko.

Nokia had in cash and other liquid assets ï8.3 billion (ï5.79 billion) at end-June, but it has shied away from major takeovers in the past.

"Buying Navteq would be in line with Nokia's plans. Navteq's position is pretty strong," said OKO Bank analyst Hannu Rauhala. "Navigation markets are just starting up."

Navteq has been seen as a takeover target since TomTom, the world's top maker of car navigation devices, offered ï1.8 billion (ï1.25 billion) in July for Navteq's only big rival, Tele Atlas.

Google and Microsoft have also been touted in the media as potential buyers of Navteq.

Nokia bought into the navigation industry last year when it acquired German software firm Gate5, which uses map data from providers like Tele Atlas and Navteq.

Navigation is one of the fastest growing segments in the technology industry and many market followers see still huge untapped potential in the market.

Nokia news, reviews, themes and downloads at Know Your Mobile

Email to a friend

Print this page

Social Bookmark this article: What is this?

Digg

Delicious

Reddit

StumbleUpon

Slashdot

Google

Facebook