[Asia Economy Reporter Jeong Hyunjin] Mobileye, the autonomous driving subsidiary of U.S. semiconductor company Intel, saw its stock price surge nearly 38% on its initial public offering (IPO) day, June 26 (local time), closing sharply higher.
According to Bloomberg and other sources, Mobileye's stock closed at $28.97, up 37.95% from the offering price of $21 (about 30,000 KRW). Mobileye's shares began trading at $21, which is $1 higher than the top end of the expected offering price range ($18?$20). Through this IPO, Mobileye raised $861 million.
The market capitalization jumped from approximately $17 billion to about $22 billion. This far exceeds Intel's acquisition price of $15.3 billion in 2017. However, it is less than half of the $50 billion that Intel initially expected when it announced the IPO plan at the end of last year.
Mobileye attracted significant market attention as it went public amid a subdued IPO market this year. According to Bloomberg, the total IPO volume on the U.S. stock market so far this year is $23 billion, which is less than 10% of last year's $279 billion for the same period. Mobileye's IPO is the fourth largest in the U.S. this year.
Amnon Shashua, Mobileye's founder, stated in a letter to shareholders, "The core of our business is making human-driven cars safer," adding, "At the same time, we are making relentless efforts to bring the future of autonomous vehicles."
Mobileye announced that it plans to use the funds raised through the IPO to partially repay debt owed to Intel, with the remainder to be used for corporate operating expenses.
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