Financial Markets Wall Street Mobileye IPO

Israel-based vehicle safety technology company Mobileye (NYSE: MBLY) has successfully launched its Initial Public Offering on the New York Stock Exchange, raising approximately $890 million to value the company at a reported $5.3 billion.

You may have never heard of Mobileye, but that doesn't mean its system isn't in your car. The company, which lists its headquarters in the Netherlands (much like Fiat Chrysler Automobiles and the Renault Nissan Alliance) but operates its R&D center in Jerusalem, develops and produces safety systems for automobiles that combine cameras (instead of radar) and software algorithms to detect other vehicles, pedestrians and lane markers (among other objects) to keep the car on the straight and narrow. While it sells systems (often purchased by fleet operators) that can be retrofitted to existing vehicles, a large portion of its business is in selling its devices to automobile and truck manufacturers for installing in their products on the assembly line. Mobileye lists among its customers General Motors, Ford and Chrysler; Honda, Nissan, Mitsubishi and Hyundai; Audi, BMW, Volvo, PSA and Jaguar Land Rover. The company is said to be developing its own autonomous vehicle prototype.

The IPO launched on Friday was the largest ever fielded by an Israeli company in the United States and makes it the fifth largest company trading on Wall Street. While Israel accounts for the third largest number of companies listed on the NASDAQ, Mobileye chose the NYSE instead, opening trading at $25 per share (higher than the expected $21-23 per share) to raise $890 million for the company's principal owners and stockholders. After a fierce day of trading that saw its stock jump as much as 58 percent to $39.40/share, it closed at $37/share for an increase of 48 percent.

While the company included outside shareholders in the IPO, it was the company's founders who benefited the most. Mobileye was started in 1999 by Professor Amnon Shashua and Israeli businessman Ziv Aviram. Shashua studied at Tel Aviv University, the Weizman Institute of Science and MIT, lecturing at the Technion Israel Institute of Technology and the Hebrew University of Jerusalem before founding Mobileye with Aviram, who had previously run local operations like Keter Publishing and the Gali shoe chain. The two were said to have made $92 million between them from the IPO.