Hitachi, the manufacturer of technology and industrial products and services, intends to strengthen its digital business and announced that they bought the software firm GlobalLogic for 9.6 billion USD.
Japanese technology company Hitachi Ltd. announced the acquisition of GlobalLogic Inc, a Silicon Valley-based software development services provider, for close to US$9.6 billion to strengthen its digital services business, a booming sector in the current context of the COVID-19 coronavirus pandemic.
Hitachi said in a statement that demand for the services offered by GlobalLogic is increasing dramatically and that, through the purchase, it will acquire digital engineering capabilities and a strong customer base.
The Japanese firm will purchase all of the existing shares of the U.S. firm through Hitachi Global Digital Holdings, the subsidiary that oversees its IT (Information Technology) business in the United States, it confirmed in a statement.
Toshiaki Higashihara, president of Hitachi, said that the partnership will help them to achieve their goal of “becoming a leader in digital innovation”. Shashank Samant, president of GlobalLogic, said, “The deal is an incredible opportunity.
Hitachi noted that the total acquisition cost, including the payment of GlobalLogic’s debt, is estimated at US$9.6 billion. The Japanese multinational expects to get the green light from the relevant regulators and complete the deal by the end of July 2021.
The merger with GlobalLogic follows other investments outside Japan by the technology conglomerate. In July 2020, it completed the acquisition of a majority stake in the electronic networking business of Swiss engineering group ABB, while divesting a stake in its own chemicals unit.
Founded in 2000, GlobalLogic has more than 20,000 employees in 14 countries and serves more than 400 clients. The company is privately owned by the Canada Pension Plan Investment Board, Partners Group, AG, and several investors, including GlobalLogic executives.