Mobileye Jumps After Raising Largest Israeli IPO in the U.S.

Aug 01, 2014 12:10 pm ET

Aug. 1 (Bloomberg) -- Mobileye NV, the Israeli company creating software for driverless cars, jumped on its first trading day after raising $890 million in its initial public offering in the U.S.

Mobileye, whose software anticipates potential collisions, surged 55 percent to $38.75 at 11:35 a.m. in New York. The company and existing shareholders sold 35.6 million shares for $25 each, above the high end of the marketed range, according to a press release. The company increased its price range this week to $21 to $23 apiece.

Jerusalem-based Mobileye’s IPO surpassed Partner Communication Ltd’s share sale of $525 million in October 1999 to become the biggest U.S. IPO by an Israeli company. Founded by Hebrew University professor Amnon Shashua and Ziv Aviram 15 years ago, Mobileye makes a chip and a system that alert drivers to pedestrians and unintended lane departures. The company’s products will help enable hands-free driving on the highway by 2016, according to the filing.

As of March 31, Mobileye’s technology was installed in about 3.3 million cars made by manufacturers from Honda Motor Co. to Tesla Motors Co., the company estimates. Mobileye’s software is distributed through auto-parts suppliers such as TRW Automotive Holdings Corp. and Delphi Automotive Plc.

Mobileye posted 2013 net income of $19.9 million following two years of losses, according to the prospectus. Revenue in 2013 was $81.2 million, more than double the figure from 2012. Mobileye intends to use some of the net proceeds from the IPO to purchase inventory.

The company counts Goldman Sachs Group Inc., Fidelity Investments and BlackRock Inc. as investors, according to the filing. Goldman Sachs is selling shares in the offering, in addition to some Mobileye executives and other individual investors.

Goldman Sachs and Morgan Stanley managed the offering. The stock is listed on the New York Stock Exchange under the symbol MBLY.