Inclusive of debt, GlobalLogic will be acquired by the Japanese group for a total sum of $9.6bn
Japanese conglomerate Hitachi has agreed to acquire US digital engineering services company GlobalLogic for nearly JPY918bn ($8.5bn).
Including debt, the total acquisition cost is expected to be $9.6bn.
In this connection, an agreement has been signed by the Japanese group’s US subsidiary – Hitachi Global Digital and GlobalLogic’s parent firm – GlobalLogic Worldwide.
Based in Silicon Valley, GlobalLogic has eight design studios and 30 engineering centres across the world.
The company is owned and funded by Canada Pension Plan Investment Board and Partners Group. It employs more than 20,000 people across 14 countries.
GlobalLogic is said to have developed deep chip-to-cloud advanced software product engineering technology, besides having design skills and vertical industry expertise.
The company designs and develops innovative software that is said to power its clients’ products, platforms, and digital experiences.
GlobalLogic’s revenues in fiscal 2021 are estimated to be nearly $1.2bn.
GlobalLogic president and CEO Shashank Samant said: “Companies in every industry are transforming with digital technology – to better engage customers, create new revenue streams and drive a higher quality of life.
“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.”
By adding GlobalLogic’s advanced digital engineering capabilities and its client base, Hitachi hopes to bolster the digital portfolio of its Lumada advanced digital solutions and services.
The group’s US-based digital infrastructure, data management, and digital solutions business – Hitachi Vantara is said to have an important role in driving the business growth of Lumada in the global market.
Hitachi further stated that the deal will help create synergies across its IT, energy, industry, smart life, and mobility sectors and automotive systems business Hitachi Astemo. These will be achieved by fast-tracking the advanced digital transformation of rail, energy, healthcare, and other social infrastructure at a global scale, said the Japanese conglomerate.
Hitachi president and CEO Toshiaki Higashihara said: “The acquisition of GlobalLogic creates an exciting new opportunity for Hitachi to expand our offerings of Lumada solutions and services, provide values 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.”
The deal, which is subject to regulatory approvals and customary conditions, is expected to be closed by the end of July 2021.