Intel Corporation is to buy Mobileye, which specialises in developing computer vision and machine learning, data analysis, localisation and mapping for driver assistance systems and autonomous driving.
An Intel subsidiary will offer Mobileye shareholders US$63.54 per share in cash, valuing the company at $15.3bn.
“The combination is expected to accelerate innovation for the automotive industry and position Intel as a leading technology provider in the fast-growing market for highly and fully autonomous vehicles,” a joint Intel/Mobileye statement said.
“Intel estimates the vehicle systems, data and services market opportunity to be up to $70bn by 2030. This transaction extends Intel’s strategy to invest in data-intensive market opportunities that build on the company’s strengths in computing and connectivity from the cloud, through the network, to the device.
“This acquisition will combine the best-in-class technologies from both companies, spanning connectivity, computer vision, data centre, sensor fusion, high-performance computing, localisation and mapping, machine learning and artificial intelligence.”
The combined global autonomous driving organisation, consisted of Mobileye and Intel’s Automated Driving Group, will be based in Israel and headed by Mobileye co-founder, chairman and chief technology officer Amnon Shashua.
The new organisation will support both companies’ existing production programmes and develop relationships with automotive OEMs, Tier-1 suppliers and semiconductor partners to develop advanced driving assist, highly autonomous and fully autonomous driving programmes.
Intel senior vice president Doug Davis will oversee the combining of the two groups and will report to Shashua after the deal is done.
“This acquisition is a great step forward for our shareholders, the automotive industry and consumers,” said Intel CEO Brian Krzanich, Intel CEO.
“Intel provides critical foundational technologies for autonomous driving including plotting the car’s path and making real-time driving decisions. Mobileye brings the industry’s best automotive-grade computer vision and strong momentum with automakers and suppliers. Together, we can accelerate the future of autonomous driving with improved performance in a cloud-to-car solution at a lower cost for automakers.”
“We expect the growth towards autonomous driving to be transformative. It will provide consumers with safer, more flexible, and less costly transportation options, and provide incremental business model opportunities for our automaker customers,” said Ziv Aviram, Mobileye’s co-founder, president and CEO.
“By pooling together our infrastructure and resources, we can enhance and accelerate our combined know-how in the areas of mapping, virtual driving, simulators, development tool chains, hardware, data centres and high-performance computing platforms.”
As cars progress from assisted driving to fully autonomous, they are increasingly becoming data centres on wheels. Intel expects that by 2020, autonomous vehicles will generate 4,000 GB of data per day, which, it said, “plays to Intel’s strengths in high-performance computing and network connectivity”.
The sale is expected to close within nine months.
Reuters reported the $63.54 per share cash deal is the world’s biggest purchase of a company solely focused on the autonomous driving sector.
Mobileye accounts for 70% of the global market for advanced driver-assistance and anti-collision systems, the news agency noted.
The two companies are working with BMW to put around 40 self-driving test vehicles on the road in the second half of this year, the report added.
Mobileye had relied on STMicroelectronics to produce chips for its current, third-generation of driver-assistance systems but, during the BMW project, it turned to Intel for fifth-generation chips for use in fully autonomous vehicles scheduled for delivery around 2021, Reuters said.
Qualcomm last October announced a US$47bn deal to acquire NXP, the largest automotive chip supplier, putting pressure on other suppliers wanting to sell autonomous driving components, including Intel, Mobileye and NVIDIA, Reuters added.
In a statement to employees, Mobileye said the transaction was unique in the sense that instead of Mobileye being integrated into Intel, Intel’s automated driving group would be integrated into Mobileye.
“Within the ADG are resident skill sets that are largely complementary to ours.
“Combining forces will help accelerate our plans and lower our execution risks.”