Friday, July 04, 2008

Nokia-Navteq merger gets green light from Europe's competition authority

On Wednesday, Finland mobile phone giant, Nokia, received green light from Europe’s competition authority to acquire Navteq, a US-based digital map producer. The deal is worth $12.1 billion. Two months ago, Tom Tom, the largest car navigation device producer, took over Tele Atlas, another digital map database provider. The took over cost Tom Tom €2.9bn. Chicago Tribune reports:

The case is the second acquisition of a digital map company to receive EU clearance this year. The commission approved plans by TomTom, Europe's biggest maker of car-navigation devices, to buy Tele Atlas NV on May 14.

"Navteq will play a key role in our Internet services strategy," Olli-Pekka Kallasvuo, Nokia's president and chief executive, said in a statement.

The European competition authority concluded that Navteq-Nokia merger would not have any negative impact in Europe. Because of Tele Atlas, Navteq-Noqia merger would not gain monopoly over map database industry in Europe. Nokia-Navteq would not shut down supply of such databases to competitors because the loss made in sales of maps can not be offset by sales of mobile phones.

Related articles:
Financial Times

Chicago Tribune