Mobileye founders implicated in insider trading affair

The pair are believed to have exploited connections with insiders at Mobileye, through their association with the university, where the technology used by Mobileye was developed.

AUGUST 16, 2017 12:49

Updated: AUGUST 17, 2017 02:41

Mobileye founders Prof. Amnon Shashua (left) and Ziv Aviram (photo credit: Courtesy) — Mobileye founders Prof. Amnon Shashua (left) and Ziv Aviram

(photo credit: Courtesy)

Mobileye’s Israeli cofounders, Prof. Amnon Shashua and Ziv Aviram, are being accused of insider trading by the US Securities and Exchange Commission stemming from the recent record $15.3 billion deal whereby Intel Inc. purchased the vehicle safety-systems company.

According to the indictment, filed on Wednesday with the US District Court in Manhattan, the tech leaders are accused of buying an undisclosed amount of shares just before the 28% jump in the share price on the day the acquisition by Intel was announced.

They are also being accused of exploiting their connections with insiders at Mobileye through Shashua’s association with the Hebrew University of Jerusalem, where the technology used by Mobileye was developed.

Last March, the two companies announced Intel’s intention to acquire Mobileye at $63.54 per share, making it the largest deal ever in Israel’s hi-tech sector.

Earlier this month, Intel and Mobileye announced the completion of the first stage in Intel’s acquisition, which includes Intel’s Autonomous Driving Group being merged with Mobileye to lead Intel’s autonomous driving efforts.

As an Intel subsidiary, Mobileye will continue operating from Israel under the leadership of Shashua, a computer science professor at the Hebrew University, who will also be appointed Intel senior vice president and Mobileye CTO. Aviram, who was the company’s president and CEO before it was acquired by Intel, has resigned from the company.

Intel and Mobileye announced on August 8 that the second stage of the transaction will end on August 21, or be extended by at least five business days to enable minority shareholders in Mobileye who have not yet sold their shares to do so.

After completion of the deal, Mobileye submitted a written document to the New York Stock Exchange stating that it will delist its ordinary shares as soon as possible.

Mobileye has not released a statement regarding the indictment.

Globes contributed to this report.