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Intel Corp. plans to wring around $1.5 billion out of Mobileye Global Inc., selling 35 million shares of the self-driving technology company, according to a securities filing.
The chip giant is taking advantage of a doubling of Mobileye’s value since it took the company public last October.
Mobileye (Nasdaq: MBLY) was down about 1.3% at $41.83 in midday trading on Tuesday, a day after it filed a prospectus for the offering. Intel (Nasdaq: INTC) was up 4% at $31.05.
The move comes as Intel continues to pursue an expensive revitalization plan even as it navigates a chip downturn and competitive pressure that has resulted in two consecutive losing quarters, including a record $2.8 billion loss in the first quarter this year.
The company is spending billions on new fabs and other facilities, but also slashing spending through layoffs and other measures. It’s aiming for $3 billion in cuts this year and an annualized reduction of $10 billion by 2025.
Intel owned 93.1% of outstanding Mobileye stock and held 99.3% of voting power in the company as of May 15. When the offering goes through those stakes will fall to 88.7% of outstanding stock and 98.7% of voting power, according to the Mobileye filing.
Intel paid $15.3 billion for Israeli company in 2017. It took Mobileye public in on Oct. 26, selling 41 million shares at $21. That gave Mobileye an initial market capitalization of $16.7 billion. Its market cap midday Tuesday was $33.5 billion.
Intel is based in Santa Clara, California, but the chip giant is the largest private employer in Oregon, where it has its manufacturing R&D hub. The company did not immediately respond to a request for comment.