Mobileye, Intel deal clears last antitrust hurdle, paving way for share sale

Deadline for Intel to buy the auto-tech firm’s shares in tender for $15.3 billion has been now set for August 7

Shoshanna Solomon was The Times of Israel's Startups and Business reporter

The Mobileye logo on a car in Jerusalem, March 14, 2017. (Yonatan Sindel/Flash90)
The Mobileye logo on a car in Jerusalem, March 14, 2017. (Yonatan Sindel/Flash90)

Israeli automotive technology firm Mobileye said Tuesday that it has attained all of the antitrust clearances needed for Intel Corp. to acquire the firm’s shares. The company also said that a deadline for the share sale has been now set for August 7, earlier than the August 11 deadline.

Mobileye said in a statement Tuesday that it received on July 31 the go-ahead from the Korea Fair Trade Commission for the deal, paving the way for the sale to proceed. On Monday, the company delayed the share sale to Intel to August 11, pending the approval, and said the full transaction is expected to close during the third quarter of the year.

US giant Intel Corp. said in March that it agreed to buy Mobileye, a Jerusalem-based developer of advanced vision and driver assistance systems, for $15.3 billion, the largest-ever purchase of an Israeli tech firm.

As part of the deal, Cyclops, a subsidiary of Intel, would put out a tender to acquire all of the issued and outstanding ordinary shares of Mobileye for $63.54 per share in cash. This tender was set to expire at 5 p.m. Eastern time on June 21, and was delayed to July 20 and then once again, to July 28, and then to August 11 pending regulatory permits. Now it has been pushed up to August 7.

On Tuesday, Mobileye urged shareholders to tender their shares in the tender offer ahead of the deadline.

According to the statement on Monday, as of the end of day July 28, some 78.63% of the outstanding Mobileye ordinary shares had been validly tendered following the tender offer, and an additional 12.21% of the outstanding Mobileye ordinary shares have been tendered pursuant to guaranteed delivery procedures. This brings the shares already tendered to over 90%.

Intel needs at least 67% of Mobileye’s outstanding shares to be validly tendered and not withdrawn at expiration of the tender offer.

“Considering the high level, approximately 91%, of Mobileye shares that have already been tendered, the parties may opt to complete the whole deal as a tender offer, which may be quicker and simpler than the alternative backup route, approved by Mobileye’s shareholders, of an asset sale, followed by a dividend and then dissolution of Mobileye,” said Shirin Herzog, a senior partner and head of mergers and acquisitions at the Israeli law firm Ron Gazit, Rotenberg & Co., who is not involved in the deal.

“Completion of the tender offer route can be done by attaining over 95% of the outstanding shares, either from Mobileye shareholders or through Intel exercising its option to acquire Mobileye’s shares,” she said.

On June 13, shareholders held a meeting in Amsterdam where they approved the sale to Intel.

Mobileye develops sensors and artificial intelligence that allow a vehicle’s onboard computer to know where it is in relation to other vehicles, pedestrians and the surroundings, the key technologies needed for cars to eventually safely drive themselves.

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