The rapid rise of smart vehicles is driving a lot of investor interest in the tech companies that are helping the auto industry build out its digital capabilities.
One name that has been coming up particularly often lately is mapping provider HERE, a former Nokia Corp. subsidiary that was acquired by a group of German car makers last year for $3 billion. The firm announced today that its owners have sold a 10 percent stake to Chinese navigation provider NavInfo Co. Ltd., Internet giant Tencent Holdings Ltd. and GIC, Singapore’s second largest sovereign wealth fund.
The news comes six months after a board member from Daimler AG, one of the car makers that bought HERE from Nokia, revealed that the group is seeking additional investors. The Wall Street Journal reported at the time that the group had initiated talks with Amazon.com Inc., Microsoft Corp. and several competitors from the auto industry. There was no hint of Tencent or its peers being involved in negotiations, which suggests that they joined at a later point.
HERE didn’t divulge how much the companies paid for their stake. However, the relatively large number of parties that took part in the talks indicates there was likely some competition over the equity, which may have raised its value. The lucrative revenue opportunities in the Asia-Pacific auto market may have influenced the deal as well.
As part of the investment, HERE will establish a joint venture with NavInfo that will focus on bringing its services into China and developing new high-definition maps. The collaboration expands upon a 10-year cooperation that traces back to the time when HERE company was still part of Nokia.
Tencent plans to incorporate HERE’s technology and data into its lineup of consumer software. The mapping provider named the QQ and WeChat messaging services as the two of the offerings that may be involved in the integration effort.