Intel buys Mobileye in $15.3B deal, moves its automotive unit to Israel

First, they partnered, and now comes the acquisition: The computing giant Intel has confirmed that it is acquiring Mobileye, a leader in computer vision for autonomous driving technology, for $15.3 billion — the biggest-ever acquisition of an Israeli tech company.

Specifically, “Under the terms of 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 a fully diluted equity value of approximately $15.3 billion and an enterprise value of $14.7 billion,” the company noted in a statement. The deal is expected to close in about nine months, Intel said.

Mobileye today covers a range of technology and services, including sensor fusion, mapping, front- and rear-facing camera tech and, beginning in 2018, crowdsourcing data for high-definition maps, as well as driving policy intelligence underlying driving decisions. This deal will bring under Intel’s umbrella not only a much bigger range of the different pieces that go into autonomous driving systems, but also a number of relationships with automakers. In the call today, Mobileye’s CTO and co-founder Amnon Shashua said the company is working with 27 car manufacturers, including 10 production programs with Audi, BMW and others going into 2017.

“This acquisition is a great step forward for our shareholders, the automotive industry and consumers,” said Brian Krzanich, Intel CEO, in a statement. “Intel provides critical foundational technologies for autonomous driving including plotting the car’s path and making real-time driving decisions. Mobileye brings the industry’s best automotive-grade computer vision and strong momentum with automakers and suppliers. Together, we can accelerate the future of autonomous driving with improved performance in a cloud-to-car solution at a lower cost for automakers.”

“We expect the growth towards autonomous driving to be transformative. It will provide consumers with safer, more flexible, and less costly transportation options, and provide incremental business model opportunities for our automaker customers,” Ziv Aviram, Mobileye co-founder, president and CEO, added. “By pooling together our infrastructure and resources, we can enhance and accelerate our combined know-how in the areas of mapping, virtual driving, simulators, development tool chains, hardware, data centers and high-performance computing platforms. Together, we will provide an attractive value proposition for the automotive industry.”