Hot business deals were happening today in cold Helsinki, Finland. Nokia and GPS maker Navteq announced today a definitive agreement for the purchase of Navteq, valued at $8.1 billion.  Nokia will pay $78 in cash for each share of Navteq including outstanding options.

The acquisition is nearly finalized, having been approved by the board of directors of each company and now only awaits NAVTEQ shareholder approval.

The cell-phone GPS market has been rapidly growing, with many users looking to find directions on-the-go with their cell phones.  Nokia says that Navteq will provide the "best-in-world maps and navigation industry expertise, a strong customer base and an industry-leading map data and technology platform with the broadest geographical coverage."

Navteq was found in 1985 and is based out of Chicago, Illinois.  It has grown very large, with over 3,000 employees in 168 offices in 30 countries worldwide.  It posted 2006 revenues totaling $582 million USD.

Navteq owns Traffic.com, an interactive web service that provides traffic information and content to consumers.  The company also is a leader in providing mapping and GPS solutions to businesses and the government.

Nokia announced that Navteq will continue to support its existing customers.  Navteq will also add new capabilities to the Nokia Internet service.

Nokia hails itself as "the world's largest mobile device manufacturer" and claims to have over 900 million customers using its mobile offerings worldwide.

Nokia is looking to solidify its position as the mobile leader by expanding its mobile GPS offerings, including adding Nokia Maps, a GPS service to its new phone lines.  The Nokia N95 multimedia computer, which went on sale earlier this year, comes preloaded with the software and also features 2.6" QVGA screen, 160MB of internal memory, microSD slot for memory expansion, 3G, WiFi and Bluetooth.  An 8 GB version has also been released.

Olli-Pekka Kallasvuo, President and CEO of Nokia, hailed the acquisition as a major victory. "Location based services are one of the cornerstones of Nokia's Internet services strategy,” said Kallasvuo.” The acquisition of NAVTEQ is another step toward Nokia becoming a leading player in this space.  By joining forces with NAVTEQ, we will be able to bring context and geographical information to a number of our Internet services with accelerated time to market. We also look forward to maintaining and enhancing the services and support provided to NAVTEQ's existing and future customers."

The move will likely strengthen Nokia in the long term, but may dilute earnings for Nokia in 2008 and 2009 -- a possible concern to investors.

Still, Jari Honko, an analyst at eQ Bank in Helsinki, sees the move as wise.  He called Navteq "the most significant player in its field" and added, "It makes a lot of sense.  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."

The acquisition comes at the same time as Nokia's recent launch of a new Apple iPhone-bashing campaign, as covered by DailyTech, which derides the Cupertino-firm's attempts to lock its phones to the AT&T network and "brick" phones that do not comply or have third party apps installed.

The acquisition marks one of the largest technology business acquisitions of the year.