Shares of Intel (INTC -0.61%) climbed on Tuesday after the semiconductor giant announced plans to take its Mobileye autonomous vehicle business public.
As of 2:55 p.m. ET, Intel's stock price was up nearly 4%.
Intel acquired Mobileye in 2017. The Israel-based company is a leading provider of advanced driver assistance and self-driving technology. It has relationships with over 30 automakers and expects to generate revenue growth of more than 40% this year.
"Mobileye has realized accelerated growth and opportunity since joining the Intel family, nearly tripling annual chip shipments, revenue, and the number of employees since the acquisition," Mobileye CEO Amnon Shashua said in a press release. "Our alignment with Intel continues to provide Mobileye with valuable technical resources and support."
Intel intends to give investors a chance to own shares in Mobileye directly via an initial public offering (IPO) in mid-2022, subject to market conditions. "An IPO provides the best opportunity to build on Mobileye's track record for innovation and unlock value for shareholders," Intel CEO Pat Gelsinger said.
Intel plans to maintain majority ownership of Mobileye following the completion of the IPO. The companies will continue to work together to develop cutting-edge automotive technologies. Intel will also integrate its Moovit mobility solutions business and its remote sensing and radar development teams into Mobileye prior to the IPO.
Looking further ahead, Intel expects semiconductors to account for roughly 20% of a premium vehicle's bill of materials by 2030. The chipmaker hopes to capture a sizable share of this potentially enormous market.