By Senad Karaahmetovic
Intel (NASDAQ:INTC) raised $861 million by selling 41 million shares of Mobileye, the company said in a press release. The chipmaker was selling shares at $21 each, which is a dollar above the top of the $18-20 indicated range in the IPO filing.
This way, Mobileye was valued at $17 billion, about 10% higher relative to the $15.3 billion that Intel paid for the business, which develops autonomous driving technologies and advanced driver-assistance systems.
However, the valuation is significantly lower than the $50 billion that Intel originally hoped to achieve for its Mobileye unit. Bloomberg News reported earlier this year that Intel will proceed with Mobileye IPO despite a difficult macro environment, valuing the company at around $30 billion.
Another report followed to note that the market is likely to value Mobileye at less than $30 billion. However, the chipmaker adjusted the IPO to ultimately sell fewer shares than planned. Intel will retain a 94-95% stake in Mobileye after the offering.
The Wall Street Journal reported that Intel and underwriters were focused on shares to trade well, hence they weren’t too bothered by a relatively low valuation.