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Hitachi Ltd said on Wednesday it will buy GlobalLogic Inc for $9.6 billion. The total stock acquisition cost is $8.5 billion which will complete by July 2021. Post this, GlobalLogic will act as a subsidiary for Hitachi. The Japanese industrial conglomerate, with this acquisition, aims to expand from electronics hardware to digital services. The acquisition is also part of its ongoing business portfolio overhaul. The company only last year acquired ABB Ltd' power grid business for $7 billion. It also indulged in a series of divestitures of its domestic hardware subsidiaries.
The company is also in talks with private equity firms to sell Hitachi Metals Ltd. The deal could fetch more than $6.4 billion, following the sale of its chemical unit and diagnostic imaging business. The company also aims to increasingly offer tech products via its Internet of Things unit - Lumada.
From the leaders
Toshiaki Higashihara, President & CEO of Hitachi, said “The acquisition of GlobalLogic creates an exciting new opportunity for Hitachi to expand our offerings of Lumada solutions and services, provide value to customers in their digital transformation journey, and grow our Lumada business globally. The synergy of GlobalLogic’s leading experience design and innovation with Hitachi's expertise in IT, operational technology, and products, will help us realize our goal to be the leading digital transformation innovator in social infrastructure worldwide. Together, we will create new social, environmental and economic value for our globally expanding client companies. We will elevate QoL (quality of life) for people through contributions to realize a sustainable society.”
“Companies in every industry are transforming with digital technology; to better engage customers, create new revenue streams and drive a higher quality of life,” said Shashank Samant, President and CEO, GlobalLogic. “We have a tremendous opportunity ahead and we are excited to embark on this journey with Hitachi; combining our collective skills, technologies, and market presence to deliver greater value to our clients as they transform their businesses.”