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Garmin offers Rs.12,752.98 crore for Tele Atlas

Posted: 06 Nov 2007     Print Version  Bookmark and Share

Keywords:navigation devices  digital map provider  unsolicited bid  acquisition 

A bidding war for digital map provider Tele Atlas NV has erupted with an unsolicited bid from navigation device maker Garmin Ltd. Garmin offered Rs.12,752.98 crore (Euros 2.3 billion) for the Dutch group, trumping an agreed bid from rival European market leader for navigation devices TomTom NV.

The move follows the recent offer by Finnish mobile phone giant Nokia to buy Navteq, Tele Atlas' only major competitor.

Both TomTom and Nokia plan to tightly integrate the maps into the design of their navigation devices and phones.

TomTom triggered the consolidation in the sector in July, which in turn led to Nokia's move earlier this month.

Garmin's offer is Rs.1,358.47 (Euros 24.50) for each share of Tele Atlas, 15 per cent higher than TomTom's offer of Rs.1,178.26 (Euros 21.25) a share. Net of the cash on Tele Atlas' balance sheet, Garmin's offer is worth about Rs.11,644.03 crore (Euros 2.1 billion) and TomTom's Rs.9,980.59 crore (Euros 1.8 billion).

Garmin CEO Dr. Min Kao said: "Given the high growth and rapid change the navigation market has undergone to date, we feel that now is the right time for Garmin to move ahead with this proposed combination with Tele Atlas. Together, we believe we can create the best available mapping solutions for our customers around the world. We also intend to make Tele Atlas content available to the entire navigation market on a non-discriminatory basis, promoting healthy competition."

Kao suggested Garmin's larger size meant its offer would allow Tele Atlas more opportunity for growth.

The global market for portable navigation devices is estimated to be worth Rs.16,988.28 crore ($4.2 billion) this year and to grow to Rs.51,773.81 crore ($12.8 billion) by 2010, according to market research firm iSuppli.

- John Walko
EE Times Europe




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