The agreement states that Nokia will pay $78 in cash for every share of Navteq, including the outstanding options.
Navteq is based in Chicago and sustains digital maps which the company licenses to web sites and global positioning systems. The company was founded in 1985 and has 168 offices in 30 countries and has a total staff of 3,000.
The company will continue to operate independently, however it will be organized as a Nokia group company according to The Associated Press.
Olli-Pekka Kallasvuo, Nokia’s president and chief executive stated “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.”
Nokia has been making many acquisitions to build up its presence in the mobile Internet space, offering users music downloads and advertisers more options in conjunction with Nokia services. Kallasvuo added that with the acquisition of Navteq, Nokia “will be able to bring context and geographical information to a number of our Internet services with accelerated time to market.”
The acquisition, like most these days, is subject to approval and should close by the first quarter of 2008.
The deal is anticipated to be fortuitous in the long run, but will initially “dilute” Nokia’s value.
It was reported that Navteq shares fell $1.12 to $76.85 Monday, and Nokia fell 71 to $37.22.