Intel Confirms Acquisition Of Mobileye Self-Driving Car Tech Firm For $15.3 Billion
With a deal valued at $15.3 billion, Intel is all set to acquire Mobileye, a company which is known to have expertise in chips for vision-based autonomous vehicles.
The news of Intel tying up with Israel-based Mobileye was announced on March 13. Earlier, it was reported by Intel that the company is expected to spend $250 million within the next two years for the development of autonomous vehicles.
As part of the deal, Intel will be shelling out $63.54 per share for Mobileye in cash. Mobileye creates autonomous driving systems, and even Tesla has deployed Mobileye's chips for its autopilot systems initially. However, post a major accident, the Elon Musk-owned company parted ways with Mobileye, blaming the latter's technology.
Importance Of The Deal
Both Intel and Mobileye are currently working in tandem with BMW to deploy 40 autonomous cars on the road by the latter half of 2017.
According to Intel, the autonomous vehicle market will grow to nearly $70 billion in the next 13 years. The company undoubtedly wants to capitalize in this aspect and with Mobileye's technology on board, Intel may well be able to do so.
The tieup with Mobileye in-house could help Intel lead the race in this sphere, bypassing competing chipmakers like Qualcomm and Nividia. The deal will also help Intel with the drone space, thanks to Mobileye creating chips and systems that aid a vehicle in navigating easily, as well as give collision warnings.
Brian Krzanich, Intel's CEO, noted that the acquisition was a step forward not only for the company's shareholders, but also for consumers and the auto industry.
"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," shared Krzanich.
The deal also brings the assets of the Xeon processors from Intel, the 5G modems, the 3D Xpoint memory and FPGAs together with the global leader in auto computer vision.
Autonomous or self-driving cars are seen as the future of the auto industry and several companies like Apple and Alphabet — which owns Google — are working on their own vehicles. In a new development, the DMV in California has given the green signal to many companies to begin testing self-driving cars that do not have a steering wheel.
How the partnership between Intel and Mobileye takes shape will be evidenced in the near future with the former already joining hands with BMW's iNext self-driving project, which is expected to launch in 2021.