updated 08:55 pm EDT, Fri June 3, 2011
Garmin may buy for Navigon deals
Garmin may be buying Navigon as a defense against the pressure on GPS devices from smartphones, sources divulged in a German leak on Friday. The deal would show Garmin taking advantage of Navigon's battering in the mapping business to pay something in the tens of millions of euros, considerably lower than what it would have been worth a few years ago. A deal could be completed as soon as June, the Financial Times Deutschland informants said.
General Atlantic Partners, a capital firm that has a 90 percent stake in Navigon, is unlikely to get any significant return on its original investment from 2005, according to the tip.
Neither of the companies was willing to comment.
Navigon had been one of the more successful GPS navigator companies by 2007 but made a potentially fatal mistake to expand its market reach just as smartphones came into play. It expanded into the US at virtually the same time as the iPhone was launching. iPhone owners didn't get proper turn-by-turn navigation support until summer 2009, but the addition of GPS the year before had already damaged Navigon and compounded losses that had already been mounting. The situation became critical when Android 2.0 and the Motorola Droid brought Google Maps Navigation and made strong turn-by-turn GPS free to use in the US.
Garmin is likely motivated by its own attempts to get away from overdependence on dedicated GPS units as well as a way to corner what's left of the existing market. The company had tried to keep its hardware alive by launching the Nuvifone with ASUS but, between long delays and poor sales, was forced to exit and rely on software. Its first iPhone app launched just two months afterwards. [via Reuters]