Cell phone manufacturer Nokia Corporation has made a takeover offer to acquire NAVTEQ Corporation, a U.S. provider of digital map information for automotive navigation systems, mobile navigation devices and Internet-based mapping applications, for $8.1 billion.

If the offer is consummated it would give Nokia a significant stake in the navigation business, a rapidly growing part of the technology industry.  The takeover by Nokia will put it in direct competition with Internet providers, Google, Inc. and Yahoo! Inc., who both currently provide mapping tools.

Industry analysts had expected that NAVTEQ would be acquired by Garmin Ltd., a worldwide provider of navigation, communications and information devices, the majority of which are global positioning system (GPS) technology enabled. NAVTEQ indicated, however, that Nokia had made the most lucrative offer, which was reported to be valued at 8.6 times NAVTEQ’s 2008 sales and 24.5 times NAVTEQ’s 2008 EBITDA earnings.  In comparison, a buyout was proposed in July 2007 by TomTom NV, the largest manufacturer of automobile navigation devices, to acquire NAVTEQ’s rival, Tele Atlas, N.V., for only 5.2 times Tele Atlas’s 2008 sales and 20.9 times Tele Atlas’s EBITDA.

Nokia indicated it would finance nearly half of the deal with cash and the remainder with debt. Industry analysts predicted that the acquisition would be good for Nokia in the long term, but also said that Nokia was paying far too much for NAVTEQ at this time.  Nokia acquired Gate5, a German software firm, last year as it tested the waters for navigation technology. Gate5 uses map data from NAVTEQ and Tele Atlas.