updated 01:20 pm EDT, Mon October 1, 2007
Nokia to buy NAVTEQ
Although the deal has yet to be approved by government regulators or even all shareholders, Nokia says that it has made an agreement to buy NAVTEQ, a prominent producer of maps and map technology for GPS systems. The acquisition will cost Nokia approximately $8.1 billion, or $78 for each NAVTEQ share including outstanding options; this is valued at $7.7 billion of the company's existing cash balance. NAVTEQ will continue to be "operationally independent," Nokia claims, but it will fall within the Nokia Group of businesses, and CEO Judson Green will be obliged to report to Nokia's chief, Olli-Pekka Kallasvuo. If finalized the deal may be completed in the first quarter of 2008.
The move could be especially beneficial for Nokia, as it may no longer have to license maps, which have found their way onto a variety of Nokia devices. One of the most prominent of these is its flagship smartphone, the GPS-enabled N95, which currently uses licensed maps combined with custom navigation software. Acquiring NAVTEQ may be an indication that Nokia plans to design more phones with built-in GPS, still a relatively rare feature.