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By Ben Stupples (Bloomberg BNA)
Intel Corp., the world’s largest computer-chip maker, has received approval from Israel’s tax agency for the $15 billion takeover of Mobileye N.V., pushing the deal a step closer to completion.
The Israel Tax Authority issued a ruling accepting the tax treatment of the deal for Jerusalem-based Mobileye, the company said in a July 14 news release. The tax ruling related to the treatment of asset sales, liquidation, and share distributions for Intel’s tender offer of $63.54 per share in cash.
Intel’s takeover of Mobileye, which makes chips for cameras and driver-assistance features, is the largest ever for an Israeli company. Through the deal, Intel is trying to accelerate a push into what many chip companies view as the next big opportunity: self-driving cars and the data they generate.
With Mobileye, Intel gains the ability to offer automakers a larger package of components they will need as vehicles become more autonomous. The Santa Clara, Calif.-based company estimates the market for vehicle systems, data, and services will be worth as much as $70 billion by 2030.
Made March 12, Intel’s tender offer for Mobileye will be extended from July 20 to July 28 as a result of the tax ruling, the news release said. The amount of Mobileye shares that must be tendered and not withdrawn prior to the deadline has been lowered from 95 percent to 67 percent, it added.
In a June 7 conference call with analysts, Intel Chief Executive Officer Brian M. Krzanich said the Mobileye deal will position the company well in the automated vehicle market. The industry will be worth $1.5 billion within the next decade, according to market data company Grand View Research.
The Mobileye deal is “about gathering data as the cars drive along the road,” Krzanich said June 7.
The transaction will see Intel de-list Mobileye as a publicly traded company, according to the news release. At the moment, the deal is expected to close in the third quarter of 2017, it added.
To contact the reporter on this story: Ben Stupples in London at email@example.com (Bloomberg BNA)
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