Intel → Mobileye

An all-cash tender at $63.54 a share, $15.3bn in all, for the Israeli maker of the vision chips and software behind most cars' driver-assistance systems — the largest acquisition of an Israeli technology company at the time, re-listed by Intel five years later.

An all-cash tender at $63.54 a share for the computer vision and driver assistance firm, which Intel re-listed in 2022.

Value

$15.3B

Announced

March 2017

Completed

August 2017

Sector

AI

Deal type

acquisition

Acquirer

Intel (United States)

Target

Mobileye (Israel)

Why it mattered

Mobileye's EyeQ chips and its camera-based perception software were in cars from 27 manufacturers, and the company had just parted ways with Tesla, its most visible customer, over the limits of driver assistance. Intel, whose processors had missed the mobile phone, did not intend to miss the car: the deal made it the supplier of the eyes for the vehicle at a moment when every carmaker was announcing autonomy, and it paid about 40 times Mobileye's revenue to do it.

The premium — 34% over the market price for a company already valued richly — was justified by the data: Mobileye's cars had mapped millions of kilometres of road, and the perception models trained on them were a moat no chipmaker could build from scratch. Intel kept the company in Jerusalem under its founder, Amnon Shashua, which is why it survived Intel's own difficulties intact.

What it left behind

Intel re-listed Mobileye in October 2022 at a $17bn valuation, keeping most of the shares, and has since sold down as it raised cash for its foundry business. The autonomy the price assumed has arrived more slowly than every 2017 forecast; the driver-assistance business the company already had is what carried the value. It remains the model for a hardware incumbent buying an AI specialist and leaving it alone.