Intel buying Mobileye for $15b

Amnon Shashua, Ziv Aviram  photo: PR

The deal is the biggest ever exit in the history of Israel's high-tech industry.

US semiconductor giant Intel is buying Israeli vehicle safety and automation systems company Mobileye (MBLY). Market sources put the size of the deal at $15 billion, which makes it the biggest ever exit in the history of Israel's high-tech industry. The deal was first reported today by the "The Marker".

Mobileye was founded by Amnon Shashua and Ziv Aviram in 1999. It developed camera-based technology for warning of road hazards. The company's main growth engine today is the systems it is developing for driverless cars.

Mobileye was floated on Wall Street in 2014 and currently has a market cap of some $10.5 billion. Its share price has shot up about 30% since news of the deal with Intel broke.

In the past year, Mobileye has forged ties with several automotive and technology giants, among them BMW and Intel, with the aim of achieving a production automated vehicle by 2021.

"In two decades it will be illegal to drive"

In September 2016, Mobileye was named by "Globes" Israeli company of the decade. In an interview that Shashua and Aviram gave to "Globes" at the time, Aviram said, "In two decades, it will be illegal to drive, because we drivers are responsible for 93% of the accidents, and road fatalities are a plague - 1.5 million fatalities a year in road accidents and 50 million more injured. I recently calculated the economic damage at $600 billion. It's a plague of the modern world, and we have somehow come to accept it with equanimity. There's a cure that will save 1.5 million lives and 50 million injured, so the autonomous car is a wave that has begun, and cannot be stopped. It won't be stopped."

Aviram added that the automated car also has far-reaching significance beyond reducing road accidents, saying, "First of all, it will cut down on the number of cars on the road, because we currently spend only 4% of our time in a car. It's the most wasteful sector around. Think of it as buying a smartphone and using it only 4% of the time. It's illogical. The number of cars will drop, some say by half, some say less, because people will no longer own a car. You operate an app. Say I want to go from point A to point B. A car will stop next to me, and collect other people on the way. If you want to go for a weekend outing with the children, you order a minivan, and if you want to go to work some morning, you order a sports car."

In the same interview, Shashua said, "You can say for sure that two things will happen by 2021: there will be premium cars operated by an automatic driver on permitted high-speed roads, for example Highway 6 in Israel (Cross-Israel Highway). This car will travel safely without any hands. You can sleep, read a book, and the system will give you some time to reassume control of the car. The system can wake you up, and if you don't take control, it will make the car stop safely on the side of the road. That should happen between 2019 and 2021.

"The other thing that will happen in 2021 is that several players will launch technology for an autonomous car in a virtually delineated urban space designed to carry passengers. These players will include BMW, and Ford. Apple Computers has also announced it, and it is likely that Google will come up with such technology by then. It will happen technologically. It will take another few years before the company and the regulators allow such a vehicle to really travel without a driver. For a few years, there will be a driver behind the steering wheel solely for the purpose of collecting statistics in order to prove that these vehicles are really safe.

"Something else that will happen in about 2023-2024 is the continuation of automatic detailed maps. An autonomous car will have the technological capability to travel from point A to point B without a driver, and here, too, a driver will have to be behind the wheel at the beginning in order to prove that it's safe. Several years after that, if everything works, you'll be able to see an automated car traveling from point A to point B without a driver in both an urban space and an interurban space."

Published by Globes [online], Israel business news - www.globes-online.com - on March 13, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

5 Comments
View comments in rows
Update by email about comments talkback
POST
Comments
Your name
Please insert your name
Content
Hyperlink in a new window Hyperlink Right Left underline italic bold Bulleted List Ordered List Face1 Face2 Face3 Face4 Face5 Face6
Your comment

Thanks
You comment was recieved and soon will be published.
In posting comments, I agree to abide by the Terms of Use
Globes encourages lively and frank debate, but posts that the editors consider merely abusive or otherwise inappropriate will be removed. Report inappropriate content
Thank you for posting your comment, which will be reviewed for publication.
Loading Comments...load
Load more comments
Amnon Shashua, Ziv Aviram  photo: PR
Amnon Shashua, Ziv Aviram photo: PR
Twitter Facebook Linkedin RSS Newsletters גלובס Capital  Markets Conference 2017