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We address the problem of localized scatternet formation for multihop Bluetooth-based personal area ad hoc networks. Nodes are assumed to know their positions and are able to establish connections with any of their neighboring nodes, located within their transmission radius, in the neighbor discovery phase. The next phase of the proposed formation algorithm is optional and can be applied to construct a sparse geometric structure in a localized manner. We propose here a new sparse planar structure, namely, partial Delaunay triangulation (PDT), which can be constructed locally and is denser than other known localized planar structures. In the next mandatory phase, the degree of each node is limited to seven by applying the Yao structure, and the master-slave relations in piconets are formed in created subgraphs. This phase consists of several iterations. In each iteration, undecided nodes with higher keys than any of their undecided neighbors apply the Yao structure to bound the degrees, decide master-slave relations on the remaining edges, and inform all neighbors about either deleting edges or master-slave decisions. To the best of our knowledge, our schemes are the first schemes that construct degree limited (a node has at most seven slaves) and connected piconets in multihop networks, without parking any node. The creation and maintenance require small overhead in addition to maintaining accurate location information for one-hop neighbors. The experiments confirm good functionality of created Bluetooth networks in addition to their fast creation and straightforward maintenance.