Intel Corp is eyeing a valuation that is significantly lower than previously expected for the initial public offering of its self-driving car unit Mobileye, the Wall Street Journal reported on Monday, citing people familiar with the matter.
Mobileye, which was originally expected to land a roughly $50 billion valuation, is now set to target one of under $20 billion and sell a smaller number of shares than originally planned, according to the report.
Intel declined to comment.
The lower valuation underscores the downturn in the market for new listings, with the tech IPO market facing its worst drought in nearly two decades.
Mobileye, which late last month unveiled its filing for a US IPO with plans to list shares on Nasdaq under the ticker “MBLY,” is still aiming for the shares to begin trading on Oct. 26, WSJ reported.
Mobileye plans to launch its roadshow for prospective investors on Tuesday, a day later than anticipated, according to the report.
Intel is slated to report its third-quarter results on Oct. 27, when the chipmaker is expected to post a drop in revenue, according to Refinitiv data, following a slump in the personal computer market and supply-chain snarls.
Intel will keep most of the money from the Mobileye IPO and use some of those funds to build more chip plants, Chief Executive Pat Gelsinger said last year.
Founded in 1999, Mobileye counts BMW, Audi, Volkswagen, Nissan, Honda and General Motors as its clients. Intel bought the company for about $15.3 billion in 2017. (Reporting by Deborah Sophia and Yuvraj Malik in Bengaluru; Editing by Shounak Dasgupta)