Chipmaker Qualcomm Inc. and Japan’s TDK Corp. said they had entered a partnership worth $3 billion to manufacture components used in smartphones and other appliances to communicate wirelessly. Shares of TDK ended the day 5.5 percent higher on the Tokyo Stock Exchange following the news.

Qualcomm would invest $1.2 billion while TDK would spin-off its design and manufacturing assets, as well as related patents, to create a Singapore-based joint venture, the companies said in a statement Wednesday.

The San Diego, California-based company would own 51 percent of the new company, named RF360 Holdings, and will have the option to acquire TDK’s stake at a later date, according to the statement. Qualcomm expected the transaction to add to its non-GAAP earnings per share within a year following the closure of the deal.

TDK said the transferred business employed about 4,200 employees with a run rate of about $1 billion in annual sales. The deal is expected to close by early 2017.

The venture seeks to combine Qualcomm’s wireless technology with TDK’s specialized ‘filters’, which convert radio waves into data inside electronic devices. Such components are currently used in drones, wireless chargers, smartphones and devices connected by the internet of things.

Teaming up with Tokyo-based TDK will allow Qualcomm to offer modules that contain all of the components needed by smartphone makers in a single, comprehensive package, Cristiano Amon, the head of Qualcomm’s chip division, told Bloomberg.