Intel to acquire Mobileye for $15.3 billion

Intel announced plans to acquire Israel-based Mobileye, a developer of vision technology used in autonomous driving applications, for $15.3 billion. Mobileye share prices jumped from $47 to $61 (the tender offering price is $63.54) on the news, a 30% premium. The purchase marks the largest acquisition of an Israeli hi-tech company ever. This transaction jumpstarts Intel's efforts to enter the emerging autonomous driving marketplace, an arena much different than Intel's present business model. The process to design and bring a chip to market involves multiple levels of safety checks and approvals as well as incorporation into car company design plans – a process that often takes 4 to 5 years – which is why it makes sense to acquire a company already versed in those activities.