Intel to Acquire Mobileye for $15.3 Billion - Automated Driving

Intel agreed to acquire Mobileye, a developer of machine vision systems for automated driving, 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 acquisition will couple the best-in-class technologies from both companies, including Intel’s high-performance computing and connectivity expertise and Mobileye’s leading computer vision expertise to create automated driving solutions from the cloud through the network to the car.

Mobileye, which is based in Israel, claims the leading market position in computer vision for Advanced Driver Assistance Systems (ADAS). Its portfolio includes surround vision, sensor fusion, mapping, and driving policy products. Mobileye's EyeQ chips are already installed in ~16M vehicles as of 2016. Its upcoming EyeQ4 and EyeQ5 chips for Level 3/4 autonomous driving programs go into production in 2018 and 2020 respectively. Mobileye currently has OEM relationships with GM, VW, Honda, BMW, PSA, Audi, Kia, Nissan, Volvo, Ford, Renault, Chrysler, SAIC and Hyundai. Mobileye reported 2016 revenue of $358 million and gross margin of 76%.  The company has approximately 660 employees.

Intel said the merger will accelerate innovation for the automotive industry and position Intel as a leading technology provider in the fast-growing market for highly and fully autonomous vehicles.  Intel estimates the vehicle systems, data and services market opportunity to be up to $70 billion by 2030.

“This acquisition is a great step forward for our shareholders, the automotive industry and consumers,” said Brian Krzanich, Intel CEO. “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."

Intel also noted that it expects by 2020 autonomous vehicles will generate 4,000 GB of data per day.

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