TomTom at 5-mth high on iPhone application launch

 AMSTERDAM, NETHERLANDS: Shares in TomTom, which have been slumping for the past year on weakening demand, were up 13 percent on Tuesday after the Dutch navigation device maker unveiled an application for Apple's iPhone.

TomTom was featured at Apple's Worldwide Developers Conference in San Francisco on Monday.

The Amsterdam-based company, Europe's top-seller of navigation devices, will be offering navigation software as well as an iPhone car kit to allow drivers to easily view directions.

TomTom shares were up 13.3 percent at 5.77 euros by 1236 GMT after earlier hitting a 5 month-high of 5.95 euros. The shares outperformed a flat Amsterdam blue chip index.

Petercam analyst Eric de Graaf said the announcement was good news for TomTom.

"If you want to access the smartphone market, Apple is definitely the company you want to have a deal with," he said.

De Graaf added that the main question now would be how many iPhone users would drop their Personal Navigation Device (PND) and switch to their iPhone for navigation.

TomTom said the navigation application for iPhone would be available via the Apple iTunes App Store, following the release of Apple's OS 3.0 operating system and that pricing details would follow later this summer.

TomTom has been struggling with a net debt of 1.1 billion euros ($1.5 billion), mainly due to its acquisition of digital map maker Tele Atlas, which it bought last summer.

The company has warned it may break its loan covenants this year and says it is keeping all options, including issuing new shares, open to remain within the agreements with its banks.