Nokia to Purchase NAVTEQ
Cellphone maker Nokia will purchase digital mapmaker NAVTEQ for $78 per share in cash, the firms announced today. The deal, which is expected to close in the first quarter of 2008 and is valued at approximately $7.7 billion, and has already been approved by the board of directors of each company. The deal values NAVTEQ shares at a 34% premium compared to one month ago.Nokia is seeking to capitalize on the fast growing location-based services (LBS) market. With cell phone ownership reaching the saturation point in the U.S. and many industrialized countries, cell phone makers and service providers see LBS as a key way to continue growth and add additional income-producing services. “Location based services are one of the cornerstones of Nokia’s Internet services strategy. The acquisition of NAVTEQ is another step toward Nokia becoming a leading player in this space,” said Olli-Pekka Kallasvuo, Nokia's President and CEO.
Nokia is the world’s largest mobile device manufacturer with more than 900 million people using a Nokia mobile device around the world. NAVTEQ is a provider of digital map information for automotive navigation systems, mobile navigation devices, and other uses. NAVTEQ’s current map data business will continue operationally independent, but organizationally a Nokia Group company.