Hitachi’s recent announcement discloses its plan to buy the US-based digital engineering services company GlobalLogic for USD 9.6 billion under global expansion plans for its IoT digital services business Lumada.

This buy is a small part of the plan wherein the Japanese conglomerate plans to shift the focus from hardware to digital services. Hitachi said that the acquisition would enable the company to emphasize key areas: IT, energy, industry, and mobility. Also, the company is making efforts to improve digital transformation for the rail, healthcare, and energy sectors.

GlobalLogic contains a solid market base wherein it operates design studios and software product engineering centers across 14 countries. The GlobalLogic revenue is expected to reach USD 1.2 billion for fiscal 2021. Once the deal gets finalized, it will operate as a wholly-owned subsidiary of Hitachi.

“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,” Hitachi President and CEO Toshiaki Higashihara said.

“Together, we will create new social, environmental, economic value for our globally expanding client companies and elevate QoL (quality of life) for people through contributions to realise sustainable society.”

Re-iterating the goal, Higashihara said, “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.”

Since the start of 2020, Hitachi Vantara and Hitachi Consulting have been operating as a strong collaboration under the Hitachi Vantara brand. The partnership was a part of the company’s plan to expand globally and make “aggressive investments” across Lumada-based solutions and digital capabilities.

The deal will get finalized by the end of July, based on regulatory approval.