Indian tech giant Infosys today said that its consulting arm is acquiring 81% stake in Hitachi’s subsidiary to set up a new venture in Japan. Panasonic Corporation and Pasona Inc. will be minority shareholders.

Infosys will spend JPY 2.76 billion in an all cash deal. The transaction is expected to close on or before 1 April 2019.

Hitachi Procurement Service is a fully owned subsidiary that handles materials purchasing for the Hitachi group.

“This joint venture will help Japanese corporations transform their procurement processes using next-generation digital platforms, as we bring together the combined power of deep procurement expertise, technology, global expertise and local skills,” said Ravi Kumar, president, Infosys.

Infosys will bring expertise in procurement processes, consulting, analytics and digital technologies such as artificial intelligence (AI) and Robotic Process Automation (RPA) to the venture. This will be combined with Hitachi and Panasonic’s procurement functions and local teams, and Pasona’s human capital and BPM networks in Japan. The new entity will provide end-to-end value procurement capabilities to corporations.

“We are delighted to build this new partnership, combining strengths and unlocking potential of Infosys, Panasonic, and Pasona,” said Masashi Murayama, chief procurement pfficer, Hitachi. “The procurement functions role is critical to Hitachi’ success, and this partnership will strengthen Hitachi Procurement’s global competitiveness with new operating models, and high quality delivery at speed enabled by digital technologies.”

“Japan is a strategic market for Infosys. This transaction is a significant demonstration of our commitment to building a local presence in the region in order to partner with our Japanese clients and accelerate their digital journey,” said Deepak Padaki, executive vice president and head, Corporate Strategy, Infosys.

by Parnika Sokhi