Hitachi acquires GlobalLogic for $9.6 billion

Hitachi has announced the acquisition of US-based software development firm GlobalLogic for $9.6 billion.

Hitachi expects the addition of GlobalLogic's advanced digital engineering capabilities a nd its solid client base that include major technology companies, to strengthen its digital portfolio. The acquisition will create synergies across Hitachi's five sectors - IT, energy, industry, mobility and smart life - and automotive systems business (Hitachi Astemo) by accelerating the advanced digital transformation of social infrastructure such as rail, energy, and healthcare at a global scale.

Headquartered in US, GlobalLogic has a significant presence in India, with a global headcount of 20,000. Over half of its employees are based in Noida, Hyderabad, Bengaluru and Chennai. The company had been ramping up its presence in India since 2019.

The E&RD space has in recent times become a significant focus for large players as engineering is a key component in the digital transformation story. For the digital segment, digital or software product engineering is the backbone of all software platform development and digital plumbing

For the physical segment, Industry 4.0 is driving transformation in manufacturing and asset-intensive industries. Not present in these sectors could mean not being able to provide a full set of solutions to customers and thereby allowing competitors with an opportunity to get a leg up.

The Hitachi-GlobalLogic deal is also significant because it is one of the biggest deals in the engineering space. Prominent players in the space include Pune-based Persistent Systems, Cyient and QuEST. Before this deal, Capgemini had acquired Altran Technologies for $4 billion in 2020, and a few years earlier Harman International Industries had acquired Romesh Wadhwani’s Symphony Teleca in a $780 million deal, which was later acquired by Samsung.