Report: Polaris Buying Hughes Telematics

NEW YORK (Reuters) – Polaris Acquisition Corp (TKP.A: Quote, Profile, Research, Stock Buzz), a special purpose acquisition company, will buy Hughes Telematics in an all-stock deal valued at about $700 million, the Wall Street Journal reported on Monday.

Hughes Telematics, a privately owned in-car telecommunications company, was formed in 2006 with backing from Apollo Management LP.

The Atlanta-based company makes car navigation, diagnostics, and Internet access products, and has signed contracts with Chrysler LLC CBS.UL and Daimler AG's (DAIGn.DE: Quote, Profile, Research, Stock Buzz) Mercedes-Benz unit to place its technology into their vehicles starting late next year.

The transaction is expected to close in early 2009 and will provide Hughes with $140 million in capital to fund growth.

Neither Hughes Telematics nor Polaris were available for comment on the report.

(Reporting by Matt Daily; Editing by Quentin Bryar)