ON Semiconductor is acquiring image sensor device maker Truesense Imaging from Platinum Equity for $92 million in cash, a move that will boost ON's presence in the industrial end-market sector.

Truesense produces Interline Transfer (charge-coupled device) CCD, Full Frame CCD, Linear CCD, and CMOS image sensors that target several industrial end-markets, including machine vision, surveillance, traffic monitoring, medical and scientific imaging, and photography. The deal complements ON Semiconductor's custom and standard CMOSimage sensor product portfolio, which also includes contact image sensor modules, ambient light sensors, proximity sensors, and touch sensors.

"The pending acquisition of Truesense Imaging is a step towards our stated strategic goal of expanding our presence in select segments of the industrial end-market," saidON Semiconductorpresident and CEO Keith Jackson in apress release. "With the acquisition of Truesense, we will augment our abilities to deliver a broad range of high-performance image sensors to the industrial end-market and at the same time significantly expand our customer footprint."

The deal will give the Phoenix-based chipmaker more than 200 new customers and is expected to be immediately accretive to margins and earnings. Truesense's revenue for 2013 was approximately $79 million with gross and operating margins of approximately 44% and 23%, respectively, compared with ON Semiconductor's last reported gross and operating margins of 34.8% and 11.9%. Truesense will be incorporated into ON's Application Products Group (APG).

"We view this transaction favorably, as we believe the acquisition positions the company to address emerging IoT applications requiring advanced image processing," wrote Kevin Cassidy, an analyst with Stifel Nicolaus of Washington, D.C., in a note to investors.

The acquisition is also an indication that ON Semiconductor is pursuing one of its three main objectives for 2014 that it stated during the company's fourth-quarter earnings call with analysts. Jackson said the company is seeking mid- to high-single-digit growth in three key areas -- automotive, smartphones, and industrial. Its image sensor business is already gaining momentum as it gained a key design win with a "leading manufacturer of high-speed digital imaging systems" during the quarter, he said.

ON Semiconductor's industrial business, which includes medical, military, and aerospace, represented approximately 20% of the firm's revenues in the fourth quarter. On Semiconductor capped off 2013 with quarterly sales of $718 million.

For Truesense, the combined company will enable it to leverage its technology base and imaging expertise with ON Semiconductor's R&D, manufacturing, and global logistics infrastructure, according to Chris McNiffe, chief executive of Truesense, which is based in Rochester, N.Y. Truesense, previously known as Kodak Image Sensor Solutions, was sold to Platinum Equity in November 2011 as part of Kodak's restructuring moves to generate cash. The latest deal is expected to close before the end of the second quarter of 2014.