A consortium of German premium carmakers has agreed a deal to buy Nokia’s mapping business HERE, two people familiar with the matter said on Sunday, in a push to extend the reach of automakers into digital services for connected cars.
Nokia will receive around 2.5 billion euros or $2.74 billion, as the purchaser would be compensated for certain defined liabilities of HERE now expected to be slightly below 300 million euros as part of the transaction. Its three new owners all utilize the service, as does many other manufacturers, including Ford, Toyota, and aftermarket Global Positioning System companies like Garmin.
The company is developing technology that it hopes will help create self-driving cars. At one time Nokia envisioned HERE as a global challenger to Google Maps when it was still in the handset business (it will soon be again but as a licensor of its brand rather than as an OEM).
As for those who rely on Nokia’s HERE maps, fret not because for now it looks like nothing will change.
The purchase is a move from the auto makers toward building their own platform for self-driving cars, which requires precision mapping and Global Positioning System technology.
“Going forward we can focus on our planned combination with Alcatel-Lucent”, he said, referring to Nokia’s acquisition of its French competitor rival earlier this year.
Finland based Nokia, sold its mobile phone handset operation to Microsoft Corp and now has refocused on the production of equipment used for wireless networks. Since then, HERE with a sizeable headcount of 6,654 employees had failed to find enough profit for its’ sustenance, forcing Nokia to put the little piggy in the market. “The new ownership structure of HERE will allow us to accelerate our strategy, further scale our business and fulfill our intent to become the leading location cloud company across industries”.
Nokia’s HERE mapping technology has now officially been sold to German automakers Audi, BMW and Daimler, according to a statement released by the Finnish company.