US semiconductor giant Intel announced it would buy Israeli computer technology company Granulate for $650 million, marking the chip multinational’s seventh acquisition of an Israeli company in just over five years. Intel bought Mobileye, a Jerusalem-based maker of autonomous driving systems, in 2017 for a staggering $15.3 billion, which remains the largest technology exit for an Israeli company to date.
Intel said in an announcement Thursday that the Granulate acquisition “will help cloud and data center customers maximize PC workload performance and reduce cloud and infrastructure costs.”
The terms of the agreement were not disclosed, but the Haaretz newspaper first reported that the deal was valued at approximately $650 million.
Granulate was founded in Tel Aviv in 2018 by Asaf Ezra, CEO, and Tal Asaiag, who serves as CTO. The company developed an AI-powered optimization layer that it says helps improve computing performance and enables better handling of workloads, reducing response times by up to 40% and reducing IT expenses by up to 10%. 60%.
The startup partnered with Intel in 2021 to develop Intel Workload Optimizer, an automated solution that improves workload performance and reduces latency (delay) in cloud deployments. Mobileye is leveraging the tool to optimize its cloud-based autonomous driving systems and technologies, including its mapping systems, AI applications, and cameras.
Granulate also participated in the first cohort of Intel Ignite, a startup program for early-stage deep tech companies in 2019. Granulate has raised around $45 million with investors including Red Dot Capital Partners, Insight Partners, TLV Partners and Hetz Ventures.
The purchase deal is expected to close later this year in 2022. Granulate’s 120 employees will be integrated into Intel’s data center and AI business unit, according to Thursday’s announcement.
Sandra Rivera, executive vice president and general manager of the Datacenter and AI Group at Intel, said in a company statement that Granulate’s technology strengthens Intel’s ambitions to meet growing demand in a new computing age.
“Today’s cloud customers and data centers demand high-performance, scalable software to get the most out of their hardware deployments,” said Rivera. “Granulate’s state-of-the-art autonomous optimization software can be applied to production workloads without the customer having to make any changes to their code, driving optimized hardware and software value for each data center customer and cloud”.
Greg Lavender, chief technology officer, senior vice president and general manager of Intel’s Advanced Technology and Software Group, added that Granulate’s “innovative approach to real-time optimization software complements Intel’s existing capabilities by helping customers realize performance gains, cloud cost reductions, and continuous workload learning.”
Ezra said that as part of Intel, “Granulate will be able to bring autonomous optimization capabilities to more customers around the world and rapidly expand its offering with the help of Intel’s 19,000 software engineers.”
Roughly $100 million of Intel’s Granulate purchase price is earmarked for talent retention as well as some severance packages, Haaretz saying.
This is Intel’s second planned acquisition of an Israeli company so far in 2022.
In February, Intel signed an agreement to buy Migdal Ha’emek-based company Tower Semiconductor for $5.4 billion to significantly increase semiconductor manufacturing output.
Tower Semiconductor manufactures analog semiconductor chips for the consumer, industrial, automotive, mobile, infrastructure, medical, aerospace and defense sectors. The firm has worked in the past to develop imaging technology for the US government that was used by NASA in 2018 to capture its first image inside the Sun’s atmosphere.
The purchase transaction is expected to close in about 12 months, Intel said.
Late last year, Intel said it was acquiring Screenovatean Israeli developer of streaming and mirroring solutions for mobile devices, for an undisclosed amount.
Intel bought Replay Technologies, a developer of 3D reconstruction technologies for large-scale sporting events, in 2106 but closed it in 2021.
In 2017, the multinational chip company bought Mobileye, following a roughly $2 billion acquisition of artificial chipmaker Habana Labs in 2019, and of transit technology company Moovit in 2020 for around $1 billion.
Mobileye has become a central part of Intel’s global operationsas it looks to a future with fully autonomous vehicles.
Agencies contributed to this report.