Intel to buy Mobileye for $15.3 billion in bid for self-driving lead
Mon 13 Mar 2017
Intel is set to buy Israeli self-driving firm Mobileye for an estimated $15.3 billion (approx. £12.5 million) – a move which could see the chip giant become the world’s largest driverless solutions provider.
On the news of the deal – the biggest ever acquisition of an Israeli tech company – shares in Mobileye rose almost 35% in premarket trading.
‘Pursuant to the agreement, a subsidiary of Intel will commence a tender offer to acquire all of the issued and outstanding ordinary shares of Mobileye for $63.54 per share in cash, representing an equity value of approximately $15.3 billion and an enterprise value of $14.7 billion,’ a statement confirmed.
The release continued that the acquisition would help to accelerate innovation in the automotive industry and ‘position Intel as a leading technology provider in the fast-growing market for highly and fully autonomous vehicles.’
According to Intel estimates, the autonomous vehicle systems, data and services market will reach up to $70 billion by 2030.
‘This transaction extends Intel’s strategy to invest in data-intensive market opportunities that build on the company’s strengths in computing and connectivity from the cloud, through the network, to the device,’ the company added.
Post-acquisition the autonomous organisation, which will consist of Mobileye and Intel’s Automated Driving Group, will be headquartered in Israel and headed up by Mobileye’s co-founder, chairman, and CTO Amnon Shashua.
Mobileye, founded in 1999, is a leading Jerusalem-based supplier of collision-avoidance car sensor systems, offering technology which promises to reduce vehicle-related injuries and deaths. Goldman Sachs invested $130 million in the company in 2007, and it listed on the New York Stock Exchange in 2014.
Both Intel and Mobileye are already collaborating with BMW on a project which will see a fleet of 40 self-driving vehicles tested on the roads towards the end of this year. BMW announced the partnership in July, highlighting that it hopes to develop fully autonomous cars by 2021.
Mobileye was also an early partner in developing Tesla’s self-driving technology, but it ended the collaboration publicly in 2016, citing safety concerns around the vehicles’ Autopilot hands-free system.