Technology

Intel plans to take self-driving car unit public in the U.S. in mid-2022

Mobileye’s CEO Amnon Shashua poses with a Mobileye driverless vehicle at the Nasdaq Market site in New York, July 20, 2021.

Jeenah Moon | Reuters

Intel has announced that it plans to list Mobileye, the Israeli autonomous driving firm it acquired for $15.3 billion in 2017 as part of an effort to branch out into new markets.

The Santa Clara chip manufacturer said Monday that it plans to take Mobileye public in the U.S. in mid-2022 via an initial public offering of newly issued Mobileye stock.

Intel, whose share price has fallen from $68 in April to less than $50 in December, said the listing will create value for Intel shareholders. It added that it will remain the majority shareholder of Mobileye.

Founded in Jerusalem by Amnon Shashua and Ziv Aviram in 1999, Mobileye is one of Israel’s biggest success stories in tech. The company develops self-driving cars and advanced driver-assistance systems  for other manufacturers.

Over the years, it has partnered with Tesla, BMW, Volvo and General Motors. Last July, it signed a deal with Ford to support its next generation of advanced driving and safety features across the automaker’s global product lineup. The deal includes Ford using Mobileye’s “EyeQ” camera-based detection technologies for features such as forward collision warning and for vehicle, pedestrian and cyclist detection.

In a statement, Intel CEO Pat Gelsinger hailed the acquisition of Mobileye as a success, adding that Mobileye’s revenue will be 40% higher in 2021 than it was in 2020.

“Amnon and I determined that an IPO provides the best opportunity to build on Mobileye’s track record for innovation and unlock value for shareholders,” said Gelsinger, who took over as Intel CEO in January.

The Mobileye listing marks a return to the stock market for the company, which listed on the New York Stock Exchange in 2014 after receiving an investment of $130 million from Goldman Sachs in 2007.

At the time of the Mobileye acquisition, the deal was considered expensive, especially given that Intel had most recently reported annual revenues of just $400 million. But the valuations of self-driving car companies have soared since the Mobileye takeover. Waymo and Cruise are both valued at over $30 billion each.

Mobileye had a market value of $10.6 billion when Intel acquired it. It’s unclear what kind of valuation Intel will seek to achieve for Mobileye next summer.

Following the news, Intel’s stock rose around 8% in after market trading on Monday, with shares climbing from around $49 to $51.

Overall, Intel’s share price has struggled this year, while other chip firms, including Taiwan’s TSMC and graphics chip designer Nvidia, have seen their stock soar.

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