Terms of the deal were not announced but according to Reuters, Google paid $1.3bn for the for the Tel Aviv-based start-up.

The app combines online maps with updates from other users about traffic jams, road works and accidents and will help Google enhance its own navigation system, Google Maps.

In an official blog, Brian McClendon, vice president, geo at Google, said: ‘We’re excited about the prospect of enhancing Google Maps with some of the traffic update features provided by Waze and enhancing Waze with Google’s search capabilities.

 ‘We’ll also work closely with the vibrant Waze community, who are the DNA of this app, to ensure they have what’s needed to grow and prosper.

 ‘The Waze community and its dedicated team have created a great source of timely road corrections and updates. We welcome them to Google and look forward to working with them in our ongoing effort to make a comprehensive, accurate and useful map of the world.’

Commenting on the news, Martin Hiscox, chairman and CEO of Masternaut, said: ‘Google’s acquisition of Waze is good news for the enterprise telematics market. Yes, the figure is eye-watering and we know that the main target audience is the consumer traffic tracking market, but being acquired by Google will catapult Waze into the mainstream.

‘We’ve seen this before in areas like Software As A Service, where consumer use has influenced enterprise take up, or the how the iPhone has largely led to the Consumerisation of IT.

‘The more people that become familiar with some of the features of telematics, they’ll see the benefit in their personal lives. So, when it comes to enterprise functionality, which is much more powerful and helps improve driver efficiency and safety, it’ll be easier to get people on board, from the drivers to fleet managers to C-level executives.’