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Sony reportedly buying back Toshiba's chip factory

Japanese consumer electronics maker in talks with Toshiba to purchase Japanese chip manufacturing product line in efforts to boost supply of chips used in Sony cameras and mobile phones, according to reports.

Consumer electronics maker, Sony, is reportedly planning to buy a chip manufacturing factory it had sold to Toshiba in 2008, as part of the company's efforts to increase its chip production for use in its mobile phones and cameras.

According to a report Thursday from Reuters, "a source close to the deal" said Sony is in discussions with Toshiba to purchase a chip manufacturing production line in Japan's Nagasaki prefecture. Estimated to be worth 50 billion yen (US$595 million), the deal is expected to boost Sony's supply of image sensors for mobile phones and digital cameras.

The report also noted that Sony executive deputy president, Hiroshi Yoshioka, said in a previous interview that the company was looking at ways to plug a shortage in CMOS (complementary metal-oxide semiconductor) sensor output capacity.

However, a Bloomberg report noted that Sony had denied making any announcement regarding the purchase in a statement to the Tokyo Stock Exchange.

According to Bloomberg, which quoted the Nikkei newspaper, purchase of the Toshiba facility will double Sony's monthly production of the sensors from about 20,000 to 40,000 units.

Sony had sold the plant to Toshiba in 2008 for US$835 million.

A Dec. 3 report from Gartner ranked Toshiba as the world's third-largest semiconductor vendor, after Intel and Samsung. A separate report from the research firm points to a sustained, but slow growth for the semiconductor industry in 2011, where smartphones, mobile PCs and tablets will spur market growth through 2014.