Intel $15.3 billion acquisition of Mobileye

Overview:

• US chip manufacturer Intel has reached an agreement to acquire Israeli driverless car technology company, Mobileye, for $15.3 billion as it looks to strengthen its position in a burgeoning market it estimates will be worth €70 billion by 2030.
• Mobileye, which makes sensors and cameras for automated cars, is based in Jerusalem, registered in the Netherlands and trades on Nasdaq having launched its IPO in 2014, raising around $900 million in the largest US IPO by an Israeli company yet.
• The deal will see Intel combine its automated car unit with Mobileye and headquarter the business in Israel. 
• Intel's takeover of Mobileye will be completed by one of the US buyer's subsidiaries, which will acquire the Israeli company's shares for $63.54 each through a tender offer.  
• The value of the deal represents a 34% premium on Mobileye's closing share price on the last trading day before the deal was signed.  
• Intel intends to finance the deal with cash. 
• Intel and Mobileye already work together and are collaborating with car maker BMW on a driverless car project which should see 40 functioning test vehicles in 2017. 
• Globally, technology and automotive companies are competing to gain share in what is becoming a crowded driverless car market; in 2015 Audi, BMW and Daimler teamed up to acquire Nokia's mapping technology for €2.8 billion.
• Intel said it expects the deal to close within nine months. 
• Should the deal complete as expected, it will be the largest inbound acquisition of an Israeli company to date.
• Citibank and Rothschild are acting as financial advisors to Intel, Raymond James & Associates is advising Mobileye. 

Ben Naylor - Regional editor