Nokia confirms Here Maps acquisition by German automakers at €2.8bn

Nokia has confirmed that it has agreed with a consortium of German carmakers — Audi, BMW and Daimler — to sell its Here Maps business at an enterprise value of €2.8bn (£2bn, $3.1bn).

The company said it will receive net proceeds of slightly above €2.5bn, after paying off Here's liabilities of less than €300m. It will book a gain of about €1bn.

Nokia expects the complete the transaction in the first quarter of 2016, subject to customary closing conditions and regulatory approvals.

The sale comes as Nokia looks to focus on its wireless network unit for better growth. In April 2015, Nokia announced a strategic review for Here in light of its proposed combination with Alcatel-Lucent.

"With this step we complete the latest stage of Nokia's transformation. We integrated the former Nokia Siemens Networks, divested our Devices & Services business, and have now reached agreement on a transaction for Here that we believe is the best path forward for our shareholders, as well as the customers and employees of Here," Rajeev Suri, CEO of Nokia, said in a statement.

"Going forward, we will focus on our planned combination with Alcatel-Lucent. Once that is complete, Nokia will be a renewed company, with a world-leading network technology and services business, as well as the licensing and innovation engine of Nokia Technologies."

The automakers' acquisition of the mapping service comes as they look to use its potential in automating driving.

"In the automotive industry, where it serves most of the world's leading automakers, its focus is on developing precise and accurate mapping as well as services that will enable an entirely new class of driver experiences, including highly automated driving," Nokia said.

The Here business unit reported an adjusted operating profit of €46m on net sales of €552m for the first half of 2015, according to the company. At the end of June 2015, Here had 6,454 employees.

Upon closing of the transaction, Nokia will consist of two businesses: Nokia Networks and Nokia Technologies. Nokia Networks will continue to provide broadband infrastructure software and services, while Nokia Technologies will deal with advanced technology development and licensing.