Intel Eyes Significantly Lower Valuation in IPO of Mobileye Unit
Intel Corp. (US.INL) 1.97% is eyeing a significantly lower valuation than previously expected in the initial public offering of its Mobileye Global Inc. self-driving car unit, according to people familiar with the matter, in the latest sign of the beleaguered state of the new-issue market. Mobileye, which was originally expected to land a roughly $50 billion valuation, is now set to target one that is under $20 billion and sell a smaller number of shares than originally planned, the people said.
By selling fewer shares at a lower price, the company and its advisers are hoping to drum up interest that will push up the shares after they start trading, some of the people said. In another sign of the challenges facing the offering, Mobileye plans to launch its roadshow for prospective investors on Tuesday, a day later than anticipated.
The goal is still for the shares to begin trading Oct. 26, the people said. Intel and its advisers were encouraged to proceed with the roadshow Tuesday in part by the surge in markets Monday, with the S&P 500 rising more than 2.5% on some positive earnings reports. Their hope is that the markets will improve at least somewhat and give way to a more hospitable environment by the time the shares debut.