Intel Corp plans to list shares of its Mobileye self-driving vehicle business by the middle of next year, letting the chipmaker capitalize on its investment in a burgeoning industry.
Intel would remain the majority owner after the transaction, which involves an initial public offering (IPO) of newly issued Mobileye stock, the company said in a statement on Monday.
Mobileye’s executive team, led by Amnon Shashua, is to stay on board.
Photo: Reuters
News of the move, first reported earlier on Monday, sent shares of Intel up as much as 8.5 percent to US$55.30 in late trading. The stock had previously gained just 2.3 percent this year, trailing the performance of Intel’s chip peers and broader indices.
Intel chief executive officer Pat Gelsinger has been shaking up the company since taking the helm in February, looking to revive the fortunes of the world’s largest chipmaker.
Against that backdrop, Mobileye has been a particular bright spot.
The business, acquired by Intel in 2017 for about US$15 billion, has consistently grown faster than its parent — and it serves a still-nascent industry.
Intel has projected that the market for automotive silicon would reach US$115 billion by the end of the decade.
“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,” Gelsinger said in the statement.
The auto industry’s shift to electric and more autonomous vehicles is creating a huge appetite for electronics. Mobileye makes chips and software that work with sensors to let vehicles handle more driving functions.
The company recently shipped its 100 millionth EyeQ chip system and unveiled a six-passenger vehicle that is to be used for driverless ride-hailing services in Tel Aviv, Israel, and Munich, Germany, next year.
It has won contracts with more than 30 top automakers globally, Intel said on Monday.
Mobileye has about 80 percent of the global market for advanced driver-assistance vision systems, researcher Guidehouse Insights said.
The unit, based in Israel, has tested its technology in robo-taxi fleets in Tokyo, Paris, Shanghai and Detroit, Michigan.
It posted revenue of US$326 million last quarter, up 39 percent from a year earlier. Operating income doubled to US$105 million from a year earlier. Overall, Intel posted a 5 percent revenue increase in the third quarter.
Mobileye expects revenue to rise 40 percent for the full year.
The transaction would not affect Intel’s financial targets this year, the company said.
Intel has made other recent moves to push deeper into transportation technology.
Last year, it acquired Israeli start-up Moovit for about US$900 million. The purchase gave it access to data from public-transport mapping, which could be integrated into a ride-hailing service.
That division, along with Intel staff working on lidar and radar development, would be part of Mobileye, the company said on Monday.
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