Hitachi acquires GlobalLogic
Deal Financials
- Transaction Value: $9.6B
- Enterprise Value / Revenue: 12.3x
- Enterprise Value/EBITDA: 52.9x
Transaction Overview
- On March 31, 2021, Hitachi announced its acquisition of GlobalLogic for $9.6B to accelerate digital transformation services and provide better IT solutions across its five industry sector verticals (Energy, Mobility, IT, Smart Solutions, Automation system business)
- Hitachi’s growth strategy is heavily reliant on inorganic growth to improve capital efficiency and make an accelerated use of digital technologies.
- In the last 3 years, Hitachi has made 5 large acquisitions having a combined transaction value of $28.1B including GlobalLogic.
TBP’s observes Hitachi shifts focus from hardware to digital services
- Hitachi’s plan to pivot from its electronic hardware business to digital services is evident in its recent acquisitions of JR automation technologies and Fusio tech holdings expanding its global footprint in India, the US, and Europe.
- Hitachi is continuously working on enhancing its offerings in Lumada Solutions, an IoT platform that provides advanced digital solutions.
- The acquisition of GlobalLogic will allow Hitachi to offer more comprehensive solutions on their existing Lumada platform, providing value to their customer through its digital transformation journey.
- The synergy of GlobalLogic’s leading experience design and innovation with Hitachi’s expertise in IT, operational technology, and products, will help Hitachi realize their goal of becoming the leading digital transformation innovator.
Global giants acquiring smaller companies to drive digital transformation
- In April 2021, IBM acquired myInvenio, together with myInvenio, IBM plans to offer a comprehensive solution for digital process transformation and automation using AI-powered capabilities.
- In March 2021, Globant acquired Cloudshift, reinforcing its leadership in digital transformation by scaling its cloud expertise in Salesforce and growing its operations in Europe.
- In February 2021, McKinsey acquired Hypothesis to accelerate its digital delivery capabilities in Australia by adding 42 strong digital product development professionals to McKinsey Digital.
- The rapid adoption of technologies by all sizes of businesses worldwide is driving demand for digital transformation across all regions, forcing big giants to continuously improve their offerings through acquisitions.
Notable transactions in Digital Transformation
About True Blue Partners
True Blue Partners is a boutique M&A advisory firm that serves lower mid-market enterprise software, service and solutions companies. It brings the rigorous strategic and financial perspective of bulge bracket firms with a company building approach and a steadfast partnership that only an independent boutique firm can deliver. For more information please visit www.truebluepartners.com or email us at info@truebluepartners.com.
True Blue Partners is a boutique M&A advisory firm that serves lower mid-market enterprise software, service and solutions companies. It brings the rigorous strategic and financial perspective of bulge bracket firms with a company building approach and a steadfast partnership that only an independent boutique firm can deliver. For more information please visit www.truebluepartners.com or email us at info@truebluepartners.com.
