Hitachi slurps GlobalLogic for $9.6bn to bolster IoT prospects

Capitalizing on preparing digitally novice businesses for post COVID era


Hitachi announced it will purchase US software deevloper GlobalLogic for US$9.6B.

“Through the acquisition, Hitachi expects the addition of GlobalLogic’s advanced digital engineering capabilities, and its solid client base including major technology companies, to strengthen the digital portfolio of ‘Lumada,’” said Hitachi's announcement [PDF].

Lumada, Hitachi’s Internet of Things (IoT) platform, provides analytics and asset management tools.

Privately-held GlobalLogic provides software product development services for diverse needs such as e-commerce platforms, fast-food ordering apps (used by McDonald's), and digital pens and fingerprint recognition systems for Qualcomm.

“GlobalLogic has deep “chip-to-cloud” advanced software product engineering technology as well as experience design skills and vertical industry expertise,” said Hitachi's statement.

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Hitachi justified the merger by citing market research firm, IDC’s prediction that 65 percent of global GDP will be digitalized by 2022, alongside the sudden necessity for data-driven business models sparked by COVID-19 in a predominately digitally novice ecosystem.

GlobalLogic’s revenues are expected to reach US$1.2B in its 2021 fiscal year. The cool US$9.6M Hitachi is offering up includes repayment of debt and is subject to regulatory approvals. The transaction is expected to finalize by the end of July 2021.

The acquisition is more evidence that Hitachi sees its future as infusing all of its business units with digital skills. That push has seen its former storage business, Hitachi Vantara, push out of the data center and into consultancy, often alongside other arms of the Hitachi empire. ®


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