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The US chipmaker will pay $63.54 per share in cash for the Jerusalem-based Mobileye, according to a statement from both companies.
According to a report on Bloomberg Technology, Prime Minister Benjamin Netanyahu said in a text message: "Israel is becoming a global technology centre, not only in cyber but also in the automotive area.”
Israel had reportedly already singled out the automotive technology sector as a possible economic boon, allotting it 250 million shekels ($68 million) for the next five years.
In this video, Intel CEO explains the move to buy Mobileye: