Shulou(Shulou.com)11/24 Report--

According to people familiar with the matter, Intel is downgrading its forecast for an initial public offering (IPO) of its self-driving subsidiary Mobileye in the face of a broader stock market slump. If things don't improve, Intel may postpone its listing until next year.

Intel expects the IPO to value Mobileye at $30 billion (about 208.2 billion yuan), less than originally expected, according to people familiar with the matter. According to the original plan, Intel wanted Mobileye to go public in mid-2022 with a potential valuation of more than $50 billion (about 347 billion yuan).

Pat Gelsinger, Intel's chief executive, is trying to take advantage of the business, which was acquired in 2017, by divesting some of its shares. Mobileye, which makes cameras and chips that support driving assistance, is seen as a valuable asset as the car industry moves towards fully autonomous cars. But Intel is facing a bear market in chip stocks and a shortage of IPO, which makes it more difficult to complete the sale.

If chip stocks rebound, Mobileye could still complete its listing in 2022, according to people familiar with the matter. Otherwise, the plan will be postponed until next year. Representatives of Mobileye and Intel declined to comment.

If Mobileye goes public, it could help break the deadlock in which chip-related assets are hesitant to go public. Softbank Corp. Group is trying to push its chip design company Arm to go public early next year. Ampere Computing, a start-up that makes processors for data centers, is also planning an initial public offering.

For Intel CEO Henry Kissinger, Mobileye's successful IPO will help prove that its turnaround plan is bearing fruit. Intel has been affected by falling sales and earnings and lost market share to competitors such as AMD. Kissinger has outlined an ambitious spending plan to rebuild Intel's manufacturing capacity, enter new businesses and restore its technology leadership.

Intel said in December that it would remain a major shareholder after the listing of Mobileye. Kissinger said most of the earnings would be retained by Intel, but Mobileye would release its balance sheet so it could push forward its expansion plans.

Mobileye has been doing well since it was acquired by Intel for about $15 billion and has been growing faster than its parent, which could see its revenue fall by as much as 16% this year. In the second quarter, Mobileye's revenue reached $460 million, up 41 per cent from a year earlier. That helped the company's revenue grow 43% to $190 million.

Intel shares fell 1.1% to $31.1 on Monday after the latest news, falling to an intraday low. However, at the close, the stock resumed its rally. Intel shares have fallen 39% this year, worse than the overall performance of chip stocks, and the Philadelphia semiconductor index fell 31% in 2022.

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