Sony reportedly plans to take advantage of another company's misfortunes, as Reuters, the Japan Times and Bloomberg report the company plans to buy the Toshiba camera sensor business.
Currently cash-strapped, Toshiba is looking to sell assets in order to help rebuild operations-- such as a CMOS image sensor production line at a plant in Oita prefecture. "People familiar with the negotiations" say Sony plans to cough up 20 billion yen ($165 million) for the plant, gaining further manufacturing facilities (adding 100000 units a month in production capacity) and essentially eliminating a rival from the market. Hitting two birds with one stone, in other words.
"The purchase would be an economical way to flesh out [Sony's] CMOS sensor capacity, currently an area of concern,” analyst SMBC Nikko Securities says.
According to Bloomberg Sony is the global CMOS image sensor business, holding 40% of the the $8.7 billion market. While seemingly humble, the image sensor market is actually a growing one, and as such is considered by Sony as an earnings driver together with the higher profile consumer electronics, video game and movie businesses.
The Toshiba plant also has a number of big customers, including the likes of Microsoft, LG and Nikon.
Earlier this year Toshiba was hit hard with the revelation it was cooking the books by at least $1.2 billion since the 2008. Described as the biggest accounting scandal in Japan since 2011, the investigation forced Toshiba to fix earnings by 152 billion yen and the resignations of CEO Hisao Tanaka, VP Norio Sasaki, former president Atsutoshi Nishida and 8 high-level executives.
The conglomerate plans to prune a number of underperforming businesses, with workforce reductions in appliances, PCs, TVs and semiconductors.
Neither Toshiba nor Sony commented on the news stories, unsurprisingly enough.
Go Toshiba to Sell Sensor Business to Sony (Reuters)
Go Toshiba to Sell Image Sensor Production Line to Sony (Japan Times)
Go Sony CEO Aims to Build on Recovery with Toshiba Sensor Deal (Bloomberg)
Go Toshiba Executives Resign over $1.2bn Accounting Scandal (Bloomberg)
