TomTom, the fast growing Dutch navigation systems company, on Monday made a €1.8bn ($2.5bn) cash offer for Netherlands-based Tele Atlas, its main supplier of digital maps, in a deal that will bring its hardware and software under one roof.

The offer represents a 28 per cent premium to Tele Atlas’s last closing price and is 28 times its 2007 projected earnings before interest, taxation, depreciation and amortisation. US-based Navteq, Tele Atlas’s main rival, trades at around 20 times projected ebitda.