Last October, Qualcomm announced a $47 billion deal to acquire the Netherlands' NXP, the largest automotive chip supplier, putting pressure on other chipmakers seeking to make inroads into the market for autonomous driving components, including Intel, Mobileye and rival Nvidia. Intel will now hope to combine that with its own chip-making chops to capture a sizable chunk of the autonomous auto market just as it takes off. The company has a market cap of $13.44 billion, a P/E ratio of 131.78 and a beta of 0.97.
Based in Israel, Mobileye was founded in 1999 and has since provided sensors, processing hardware, and software to automakers so that their cars can sense the world around them.
The deal, which has been approved by both Intel and Mobileye boards, is expected to close by the end of 2017. Last fall, the electric vehicle company said that it plans to charge buyers of its newest cars $8,000 to activate an expanded, fully autonomous driving technology. Automakers, Krzanich said, want lower costs, faster times to market and the ability to get an autonomous driving system in one place. The move immediately gives Intel a strong foothold in the automotive industry, with Mobileye's systems already accounting for 70% of the global market for advanced driver-assistance and anti-collision systems.
"Intel is not looking to have their people come in and run Mobileye", said Ziv Aviram, Mobileye's other founder and chief executive, in a letter to employees. Ride-hailing company Uber Technologies and Volvo signed a $300 million deal for Volvo to provide SUVs to Uber for autonomous vehicle research.
Google has a partnership with Fiat Chrysler to work on autonomous minivans, and Volkswagen is working with Uber competitor Gett.
Ford Motor Co. said last month that it bought majority ownership of an artificial-intelligence startup called Argo AI as part of plans to invest $1 billion in the company. He said he's been assured that the company's operations will stay in Israel.
Intel has agreed to buy the Israeli tech firm for $15.3 (14.3 billion euros) which could give it a dominant role in the autonomous-driving sector. "The purchase dramatically proves that the vision we are leading is coming true".
Samsung Electronics Co. agreed to buy USA automotive technology manufacturer Harman International Industries Inc., for $8 billion in November. Mobileye's stock jumped on the news, while Intel's share price took a small, two percent, hit.