Hitachi Ltd. (Hitachi) announced its plans to acquire GlobalLogic, a digital engineering services company based in the United States. The acquisition will materialize through a merger involving MergeCo H Global Inc., a subsidiary established by Hitachi Global Digital Holdings Corp. for the purpose of the transaction.

Headquartered in Silicon Valley, GlobalLogic is a leading company in the fast-growing digital engineering services market. With over 20,000 professionals in 14 countries, GlobalLogic operates design studios and software product engineering centers around the world.

Through the acquisition, Hitachi expects the addition of GlobalLogic’s advanced digital engineering capabilities and solid client base, including major technology companies, to strengthen the digital portfolio of Lumada. The total acquisition cost, including repayment of GlobalLogic’s interest-bearing debt, is expected to be $9.6 billion.

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“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,” said Toshiaki Higashihara, president and CEO of Hitachi. “Together, we will create new social, environmental, and economic value for our globally expanding client companies and elevate QoL (quality of life) for people through contributions to realize a sustainable society.”

Hitachi hopes to create synergies across Hitachi’s five sectors — information technology, energy, industry, mobility, and smart life — and automotive systems business (Hitachi Astemo) by accelerating the advanced digital transformation of social infrastructures such as rail, energy, and healthcare at a global scale. Through its Social Innovation Business delivered by collaborative creation with customers, Hitachi aims to increase social, environmental, and economic value for its customers and realize a sustainable society.

Chip-to-cloud software

GlobalLogic has deep “chip-to-cloud” advanced software product engineering technology as well as experience design skills and vertical industry expertise. By combining these capabilities, GlobalLogic helps clients drive new revenue streams and incremental value for their customers by designing and developing innovative software that powers products, platforms, and digital experiences.

The company has a solid client base with over 400 comprised of market leaders and marquee brands spanning key industries such as communications, financial services, automotive, healthcare and life sciences, technology, media and entertainment, and manufacturing.

“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.”

Hitachi has been promoting initiatives to transform and provide more advanced and intelligent social infrastructure, such as rail and energy, using its digital technology, in order to achieve a transformation into a global leader in the Social Innovation Business. As part of its 2021 Mid-term Management Plan, Hitachi previously committed to the strategy to make growth investments of 1 trillion yen in the IT sector, primarily through Hitachi Vantara, to strengthen digital capabilities including digital products, solutions, partnerships, front and delivery capabilities. GlobalLogic will be an integral part and a growth engine of Hitachi’s portfolio of Lumada digital solutions and services.