Mobileye Global Inc announced that Intel Corporation (NASDAQ:INTC) plans to reduce its stake in the company in a move that will raise close to $1.5 billion for the US chipmaker.
The company said Intel subsidiary Intel Overseas Funding Corporation has commenced an underwritten secondary public offering of 35 million shares of Mobileye. It has also granted the underwriters a 30-day option to purchase up to an additional 5.25 million shares.
Shares of the Israeli automated driving technology company rose 1.2% to $30.20 in early Tuesday trade.
Mobileye said it will not receive any proceeds from the sale of the shares being offered.
Reuters reported that Intel's voting share in Mobileye will come down to about 98.7% from the 99.3% it currently holds, noting that the sale comes at a time when the company is facing intense competition in the assisted driving market from chipmakers Nvidia Corp and Qualcomm Inc, which are trying to make inroads into the space.
Mobileye, which counts BMW, Nissan and Volkswagen, among others as its customers, listed on the Nasdaq last year after raising $861 million in an initial public offering, per Reuters.
Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) are acting as joint lead book-running managers for the proposed offering.
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