XML 35 R14.htm IDEA: XBRL DOCUMENT v3.7.0.1
Acquisitions and Divestitures
3 Months Ended
Apr. 01, 2017
Business Combinations [Abstract]  
Acquisitions [Text Block]
Note 8: Acquisitions and Divestitures
Pending Acquisition of Mobileye
During the first quarter of 2017, we entered into a definitive agreement to acquire Mobileye N.V. (Mobileye). Pursuant to the terms of the agreement, a wholly-owned subsidiary of Intel commenced a tender offer on April 5, 2017 to acquire all of the issued and outstanding ordinary shares of Mobileye for $63.54 per share in cash, representing a fully-diluted equity value of approximately $15.3 billion. The transaction is expected to close within nine months of the date of the definitive agreement and is subject to certain regulatory approvals and customary closing conditions. Mobileye is a global leader in the development of computer vision and machine learning, data analysis, localization and mapping for advanced driver assistance systems and autonomous driving. This acquisition will combine Mobileye’s leading computer vision expertise with Intel’s high-performance computing and connectivity expertise to create automated driving solutions from cloud to car.
Divestiture of Intel Security Group
On September 7, 2016, we announced a definitive agreement with TPG VII Manta Holdings, L.P., now known as Manta Holdings, L.P. (TPG) to transfer certain assets and liabilities relating to ISecG to a newly formed, jointly-owned, separate cybersecurity company, called McAfee. The transaction closed on April 3, 2017, subsequent to the first quarter of 2017.
The transaction is valued at $4.2 billion, for consideration of $3.1 billion and a 49% ownership interest in McAfee. Intel financed $2.2 billion of the consideration and the debt can be refinanced and repaid by McAfee and TPG. TPG owns a 51% ownership interest in McAfee. We will reflect the divestiture in our consolidated condensed financial statements in the second quarter of 2017.
The carrying amounts of the major classes of ISecG assets and liabilities held for sale included the following:
(In Millions)
 
Apr 1,
2017
Accounts receivable
 
$
280

Goodwill
 
3,600

Identified intangible assets
 
966

Other assets
 
269

Total assets held for sale
 
$
5,115

 
 
 
Deferred income
 
$
1,552

Other liabilities
 
194

Total liabilities held for sale
 
$
1,746


In addition to total assets and liabilities held for sale are currency translation adjustments totaling $507 million. This amount, classified as other comprehensive income, is associated with currency charges on the carrying values of ISecG goodwill and identified intangible assets. We expect to recognize a pre-tax gain of approximately $375 million as well as a provision for taxes charge of approximately $850 million in the second quarter of 2017.
We ceased recording depreciation and amortization on property, plant, and equipment and identified intangible assets, respectively, as of the date the assets triggered held for sale accounting.