Finnish mobile phone maker Nokia is to buy out mapping company Navteq in a deal worth approximately €5.7bn (£4bn). The two companies announced the deal having gained the approval of each of their boards of directors. The acquisition is now to be put before Navteq’s shareholders.

Satellite navigation capabilities on mobile phones have quickly become a must-have feature for consumers. Nokia’s N95 handset – the first true satnav phone, launched at the start of this year – has proved extremely successful, due in no small part to the inclusion of Nokia Maps.

See also: Nokia N95 review

The N95 was one of the first mobile phone handsets that not only came with real-time navigation software included, but didn’t require a separate GPS receiver (usually a small Bluetooth device of similar dimensions to a USB flash memory drive) in order to function.

Since then, many more handsets with built-in navigation functions have been launched with Google Maps, at the very least, seen as a must-have.

Nokia claims to be the world’s largest mobile device manufacturer, with more than 900 million Nokia devices in use around the world. It has proven innovative in mobile and internet convergence, adding entertainment features, often via partnerships with TV and video content partners – something that its Symbian-based mobile platform has proved particularly suitable for. See Nokia restocks Video Center.

Having tested the waters with the N95, Nokia has set its sights on location-based services and claims the combination of Nokia and Navteq will make it the leading player in this market. One of the attractions for Nokia that Navteq offered was its broad geographical reach. The US and western Europe are well catered for by satellite navigation companies, but developing countries are not.