Nokia will acquire Navteq in $8 billion deal

Espoo (Finland) - The world’s largest mobile phone manufacturer Nokia has announced that it will buy digital map company Navteq for over $8 billion.

The acquisition is the most expensive in Nokia’s history. The Finland-based phone company will pay $78 per share of Navteq, bringing the total cost of the takeover to around $8.1 billion.

The new deal will make it more seamless for Nokia to add mobile maps and mapping applications to its handsets. The company reported a 74% increase in profits in the first half of this year.

Navteq was created in 1985 and has since created digital maps of 69 different countries on all continents except Antarctica. The California-based group has around 2,000 employees.

Nokia has confirmed that both companies have agreed to the terms of the acquisition, which will be paid for by cash and debt. Nokia’s existing mapping service already borrows map data from Navteq, which is in use across several of its mid- to high-end phones with GPS.

Navteq also provided maps to TomTom and Garmin, stocks of which fell rapidly upon the news of Nokia’s acquisition. The move leaves very few unacquired companies that specialize in digital consumer maps.

Navteq said it considered offers from other companies but ultimately decided Nokia’s was the most attractive.