Intel files for Mobileye IPO

Intel Corp business unit Mobileye’s anticipated IPO is a go, with official regulatory filings made late Friday.

Mobileye Global Inc., which makes chips and software for autonomous vehicles, intends to trade on the Nasdaq exchange under the ticker: MBLY. Intel first announced its intent to IPO Mobileye last year.

Intel will retain majority control of a public Mobileye under a two tier share structure. The IPO consists of Class A stock, which has one vote, and Intel will retain the company’s Class B stock, which has 10 votes. Intel will also have three seats on Mobileye’s board. Intel CEO Pat Gelsinger will serve as Mobileye board chair.

The IPO comes at a pivotal time for the chipmaker, which is Oregon’s largest private employer with more than 22,000 employees working at its research and development base in Hillsboro. Intel has stumbled in recent years, missing production deadlines and losing its position as the global leader in semiconductor manufacturer.

Wall street appeared pleased with the Mobileye IPO news. Intel (Nasdaq: INTC) shares were up more than 4% in Monday trading.

Intel initially thought a Mobileye IPO could value the business unit at $50 billion, but as the IPO market has faltered this year those expectations were cut to about $30 billion, according to Bloomberg. The parties have not indicated how many Mobileye shares will be sold or at what price.

Intel bought Mobileye, which at the time was a public company, for $15.3 billion in 2017. The move seen as the company finally jumping into the autonomous vehicle race.

Intel has been reporting Mobile performance as part of its quarterly financial reports, but the IPO filing provides more detail on the business unit.

Last year, Mobileye had revenue of $1.4 billion. That compares with $967 million revenue in 2020 and $879 million revenue in 2019.

For the first half of this year revenue was $854 million, up 21% compared to the same period a year ago.

The business unit is not profitable but it has been narrowing its losses. It lost $75 million last year. In 2020 it lost $196 million and in 2019 it lost $328 million.

Part of the IPO proceeds will go to pay Intel a $3.5 billion dividend. According to the filing, $336 million has already been paid.

“In our time with Intel, we accelerated development of important new technologies,” wrote Mobileye founder and CEO Amnon Shashua in a letter in the IPO filing. “We also tapped Intel engineering resources to build software development kits that help facilitate better design-in with our automotive customers, which in turn helped us to win more customers.”

Mobileye’s technology is used in autonomous driving as well as in Advanced Driver Assistance Systems (the technology behind elements like adaptive cruise control, collision warnings, lane keeping and evasive steering). Roughly 800 vehicle models are incorporating the company’s chips, more than 50 manufacturers are adopting the systems and 8.6 billion miles of road data has been collected, according to the filing.

Mobileye was founded in 1999 and is based in Israel. The company has 3,100 employees and about 80% are dedicated to research and development.

“I supported the sale of Mobileye to Intel in 2017 to accelerate Mobileye’s transition from world leader in driver assistance systems to a leading enabler in the evolution to autonomous driving solutions,” Shashua wrote. “Together we accomplished that goal. Now it is time for the next chapter.”

Source: www.bizjournals.com