Intel buying Mobileye for $15.3B to expand further into self-driving technology
In the largest purchase of an Israeli tech company ever, Apple chip partner Intel will dole out $15.3 billion for Mobileye, a company known for anti-collision, driver assistance, and autonomous driving solutions.
Intel and Mobileye collaborated in a test of self-driving hardware and software with BMW. No commercial projects have materialized as of yet, but about 40 test vehicles will hit the road in Europe later in 2017 as a result.
"Put just one million autonomous vehicles on the road and you have the data equivalent of half the world's population," said Intel CEO Briann Krzanich. "Our strategy is to make Intel the driving force of the data revolution across every technology and every industry. We are a DATA company. The businesses we focus on, and deliver solutions to, create, use and analyze massive amounts of data."
Mobileye used STM chips for its products that it is currently supplying to auto manufacturers. A shift to Intel-produced chips is expected by 2020.
The deal will see Intel's Automated Driving Group (ADG) integrated into Mobileye, according to Mobileye's founders. Intel's ADG, currently located in California, will be headquartered in Israel.
"Combining forces will help accelerate our plans and lower our execution risks," Mobileye founders Ziv Aviram and Amnon Shashua said in a memo to employees. "We aim to become the leading team in autonomous driving. We want to make an impact on the world and this acquisition will enable us to accomplish that."
Mobileye was founded in 1999 in Israel. It launched an IPO in 2014, and had a market value of $10.6 billion before the buyout deal was announced. Tesla ceased doing business with Mobileye after a self-driving system related crash in 2016 caused the death of a driver.
The deal is for $63.54 per share in cash, and regulatory approvals aren't expected to conclude until the end of 2017.
Rumors of Apple's interest in creating a branded self-driving car surfaced early in 2015. Dubbed Project Titan, the internal initiative was reportedly staffed by more than 1,000 engineers and other personnel working out of top secret labs in Sunnyvale, Calif., some of whom were pulled from other consumer product teams.
According to the most recent rumblings, Apple has pivoted away from a full-fledged self-driving car platform and is now focusing on the development of autonomous vehicle software and supporting hardware. Interestingly, Apple's driverless product, if it ever materializes, might intersect with the company's augmented reality initiative. In October, reports claimed Apple is currently testing AR-based navigation and other autonomous vehicle solutions using virtual reality simulators.