Sony on Wednesday announced that it is in talks with Toshiba to acquire its CMOS image sensor business. Sony will assume control of Toshiba’s plant in Oita, which will come under the aegis of Sony Semiconductor Corporation. It was being rumoured for a while that Sony is in the process of taking over Toshiba’s image sensor business. The press release said that the companies “have entered into a non-binding memorandum of understanding that confirms their intent to negotiate the transfer to Sony of certain Toshiba owned semiconductor fabrication facilities, equipment and related assets in Oita Prefecture, and also other related equipment and assets.” Employees of the plant, as well as engineers and designers of Toshiba’s CMOS sensor department are likely to be transferred to Sony. The companies have agreed to the deal in principle and will get into a legally binding agreement before the end of this year. Sony intends to complete the complete the acquisition process within the financial year ending on March 31, 2016. The Oita plant will thereafter be operated as a production facility of Sony Semiconductor Corporation. It is a fully-owned subsidiary of Sony, which primarily manufactures CMOS image sensors.
Under the terms of the deal, Toshiba will outsource the production of its image sensors to Sony following the takeover. Folding up its CMOS sensor research and production facilities will allow Toshiba to focus on its other areas of expertise. Sony, on the other hand, will be able to further expand its image sensor business, apart from obtaining Toshiba’s research. “This acquisition will enable Sony to increase its production capabilities in the area of CMOS image sensors, where further market growth is anticipated,” the release said.
Sony has a profitable image sensor business, where it is the market leader. According to a Wall Street Journal report, the Japanese company supplied 40.2 percent of all image sensors in 2014. Although the company is struggling with its own smartphones and cameras, it has managed to reap profits from its CMOS sensor sales to competitors. Most high-end smartphones ship with Sony’s CMOS image sensors and even Nikon DSLRs sport them.