Hitachi Ltd stock fell 7% on the Tokyo Stock Exchange on news that it will buy U.S software company GlobalLogic Inc. for $9.6 billion, according to Reuters. The deal value includes the repayment of debt and happens when Hitachi is pivoting from electronics hardware to digital services.
The acquisition of GlobalLogic is part of Hitachi’s ongoing business portfolio overhaul, which includes the $7 billion acquisition of ABB Ltd.’s power grid business last year.
GlobalLogic is expected to add its expertise ranging from chips to cloud services into Hitachi’s digital services business.
GlobalLogic has more than 20,000 employees in 14 countries with about 400 active clients in industries such as automobile, healthcare, and finance.
Past projects of GlobalLogic include McDonald’s customer app and in-store digital ordering system and Qualcomm’s fingerprint recognition system.
The conglomerate is also in talks with private equity firms to sell Hitachi Metals Ltd, a deal which could fetch more than $6.4 billion.
Hitachi aims to close the deal with GlobalLogic by the end of July.Hitachi stock is currently declining. 6501: TYO is down 7.30%,
