Nokia to buy Navteq

Nokia Corp is buying US navigation-software maker Navteq Corp for around $8.1 billion, the world's largest mobile phone maker said on Monday.

The deal has been approved by the boards of both companies, according to Nokia.

Under the agreement, Nokia will pay $78 in cash for each Navteq share, including outstanding options.

Chicago-based Navteq maintains digital maps which it licenses to global positioning systems and Web sites. Founded in 1985, it has around 3,000 employees in 168 offices in 30 countries.

Nokia's President and Chief Executive Olli-Pekka Kallasvuo said "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."

Kallasvuo added that by acquiring Navteq, Nokia "will be able to bring context and geographical information to a number of our Internet services with accelerated time to market."

Jari Honko, an analyst at eQ Bank in Helsinki, said Nokia is "extremely driven" in its strategy to move into mobile services and called Navteq "the most significant player in its field."

"It makes a lot of sense," he said. "This is one of the areas that should become extremely important in the future. ... Nokia could very well build one of its core services around it."

India second-largest market for Nokia

India has now become the second-largest market for Nokia in terms of sales, ahead of the US. Over the past three years, India has been gaining significant ground year-on-year, moving from the 4th position in 2005 to third in 2006, and it is today poised right behind China.

Making this announcement, Olli-Pekka Kallasvuo, the president and CEO of Nokia Corporation, who was in New Delhi today, said, “India is playing an increasingly important role in the global economy buoyed by impressive economic growth, skilled manpower and tremendous business opportunity. Today, India hosts a comprehensive Nokia R&D, manufacturing and design presence. Moreover, we are also the country’s leading provider of wireless infrastructure through Nokia Siemens Networks, the newly-merged entity. This not only reiterates our commitment and belief in the market but also underscores India’s emergence as a strategic resource hub for Nokia globally.”

The company also announced that half of the handsets manufactured at its plant in Sriperumbudur, near Chennai, was being exported to 58 countries across Asia, Africa, Australia and New Zealand.

The company currently employs over 9,000 people and has 95,000 outlets with 50,000 exclusive Nokia brand stores. The Sriperumbudur manufacturing plant alone employs 4,700 people, 70 per cent of them women.

Moreover, Nokia Telecom Park, which received an investment of $500 million (Rs 2,043 crore) from the company and seven global component manufacturers, is likely to generate over 30,000 jobs when fully functional.

Buoyed by the growth of the Indian economy and the telecommunications segment, the company sees the country as a focused market.

The prompt ‘product advisory’ issued recently (the company does not call it a recall) for the BL-5C battery manufactured by Matsushita Battery Industrial, indicates how sensitive it is about its reputation. The feedback that the company received post its advisory also reiterates its position in India. On the very first day (August 16) of the opening of its centre for advice on the faulty batteries, Nokia India answered 20,000 calls and received 1.45 lakh SMSes.

Nokia issues product advisory

Mobile handset manufacturer Nokia today issued a product advisory to recall close to 46 million Nokia-branded BL-5C batteries manufactured by Japan-based Matsushita Battery Industrial between December 2005 and November 2006.

The company stated that in rare cases, the batteries could potentially experience overheating initiated by a short circuit while charging causing the battery to dislodge. The company has received more than 100 complaints of overheating globally.

Nokia is working closely with Matsushita, and will be co-operating with relevant authorities to investigate the situation. Nokia has several suppliers for BL-5C batteries who have collectively produced more than 300 million BL-5C batteries.

In order to determine if a battery is subject to this advisory, it is necessary to remove the battery from the device. A Nokia battery will have "Nokia" and "BL-5C" printed on the front of the battery. On the reverse, the Nokia mark appears at the top and the battery identification number (consisting 26 characters) is found at the bottom. Consumers should refer to this identification number to determine if their battery is among the batteries manufactured by Matsushita between December 2005 and November 2006.

It is important to note that the BL-5C battery is not used in all Nokia products and that only a portion of the Nokia BL-5C batteries in use are subject to this advisory.

Nokia handset owners should visit http://www.nokia.com/batteryreplacement/en/ to verify if their batteries can be replaced free of charge.

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