Japan-based electronic components manufacturer TDK announced it is buying InvenSense for $1.3 billion in cash as part of its Internet of Things (IoT) strategy. InvenSense makes sensors for the consumer electronics and industrial markets.

The companies expect the deal to close in the fiscal quarter ending March 31, 2018. Following the merger, InvenSense will operate as a wholly-owned subsidiary of TDK.

TDK identifies sensors as a key enabler for IoT and all the new business opportunities IoT may afford. The company currently sells sensors that employ thin-film magnetic technology. TDK's product line includes pressure, temperature, and electric current sensors.

InvenSense is known mostly for its six-axis and nine-axis motion sensors. In recent years its portfolio has expanded with inertial, environmental, microphone, and ultrasonic sensors. Devices using sensors from InvenSense include smartphones, drones, wearables, games, inertial navigation systems, and image stabilization for cameras.

TDK plans a “sensor fusion” strategy, combining various sensor technologies with software, to meet new demands across consumer and industrial markets.

Sensors with software are a key component for IoT. And big players with these assets are lining up alliances to tap into IoT opportunities.

In November, Cisco’s IoT business, Jasper, struck up a partnership with the Indian conglomerate, Reliance Group. Jasper’s technology helps to get the data from sensors to the cloud. Reliance and Jasper plan to provide IoT services to enterprise customers throughout India.

IBM also is creating partnerships with its Watson IoT platform, including Cisco, Intel, and ARM. IBM is targeting Watson at various business verticals, including oil rigs, factories, and shipping companies. But IBM has said Watson will run only on IBM’s cloud.