Hitachi Announces Purchase of Grant Thornton LLP e-Business Consulting Group
Group to Form a Core Component of Hitachi Solutions Initiative --
TOKYO, Japan, October 25, 2000 - Hitachi, Ltd. (TSE: 6501/NYSE: HIT) today announced that it has signed a definitive agreement to acquire the e-Business Consulting Group of Grant Thornton LLP for about 175 million dollars. Last November, Hitachi announced the mid-term business plan "i.e. HITACHI Plan" to further the company's "best solutions partner" initiative including investments for acquisitions and alliances. In making the announcement Shigemichi Matsuka, executive vice president and director of Hitachi, Ltd., said, "The purchase is part of our plan to transition Hitachi from a leading hardware provider to a global leader in IT solutions. The acquisition will be a core component for Hitachi's IT solutions business in North America and enable the company to fully enter the global IT services market."
As reported in February 2000, Grant Thornton, North America's sixth largest accounting and management consulting firm, implemented a plan to unlock the value of its e-Business Consulting Group by evaluating strategic options for the group. The e-Business Consulting Group has a core competency in e-Business, information technology (IT) consulting and systems integration for mid-size and Fortune 1000 companies. With Hitachi's in-depth infrastructure experience and global capabilities, the e-Business Consulting Group will continue to focus on its core competencies and expand its penetration in the IT solutions marketplace.
"We wanted a strategic partner with a long-term vision," stated Chuck Scoville, managing partner of Grant Thornton's e-Business Consulting Group. "Keeping our clients current with IT advances requires people with knowledge and experience. We wanted a partner that understood the IT market and one that would give us the tools, such as equity ownership, to hire and retain top people. Hitachi fits all of our criteria and we can now expand our end-to-end e-Business services and grow our international footprint together with Hitachi."
Following the completion of the acquisition, a new company will be created comprising the business of Grant Thornton's e-Business Consulting Group, including the unit's management. The new company will be managed as an independent business unit and include incentive plans such as stock options. An initial public offering (IPO) is a potential in the future when the unit is significantly larger and the capital markets are more favorable. Additional investments, including other acquisitions, are planned. The target is to build a $1 billion global IT services business in 5 years.
About Grant Thornton LLP
Grant Thornton, the leading accounting, tax and management-consulting firm dedicated to serving middle-market, entrepreneurial companies, is the U.S. member firm of $1.6-billion Grant Thornton International. The firm maintains executive offices in New York. For more information, the web site is at http://www.gt.com. The e-Business Consulting Group, headquartered in Dallas, is a business unit in Grant Thornton with annual revenue of about $90 million and 15 U.S. offices. The e-Business Consulting Group provides solutions, knowledge and expertise to its clients in areas such as e-Business strategies and technologies, customer relationship management, enterprise resource planning and supply chain management.
Hitachi, Ltd., headquartered in Tokyo, Japan, is one of the world's leading global electronics companies, with fiscal 1999 (ended March 31, 2000) consolidated sales of 8,001 billion yen ($75.5 billion*) and about 340,000 employees. The company manufactures and markets a wide range of products, including computers, semiconductors, consumer products and power and industrial equipment. For more information on Hitachi, Ltd and the "i.e.Hitachi Plan," please visit Hitachi's Web site at http://hitachi.com.*At an exchange rate of 106 yen to the dollar.
Statements in this news release contain forward-looking statements, which reflect management's current views with respect to certain future events and financial performance. Words such as "anticipate," "believe," "expect," "estimate," "intend," "plan," "project" and similar expressions that indicate future events and trends identify forward-looking statements. Actual results may differ materially from those projected or implied in the forward-looking statements and from historical trends. Further, certain forward-looking statements are based upon assumptions of future events, which may not prove to be accurate. Factors that could cause actual results to differ materially from those projected or implied in any forward-looking statements include, but are not limited to, rapid technological change, particularly in the field of information and communications equipment; uncertainty as to the ability of the companies concerned to continue to develop products and to market products that incorporate new technology on a timely and cost-effective basis and achieve market acceptance; fluctuations in product demand and industry capacity; exchange rates and their fluctuations between the yen and other currencies in which the companies concerned make significant sales or in which assets and liabilities of the companies concerned are denominated, particularly between the yen and the U.S. dollar; uncertainty as to the access of the companies concerned to liquidity or long-term financing; uncertainty as to the ability of the companies concerned to implement measures to reduce the potential negative impact of fluctuations in product demand and/or exchange rates; general economic conditions and the regulatory and trade environment of major markets for the companies concerned, particularly, the United States, Japan and elsewhere in Asia, including, without limitation, direct or indirect restriction by other nations of imports; uncertainty as to the access of the companies concerned to, or protection for, certain intellectual property rights, particularly those related to information and communications equipment; the dependence of the companies concerned on alliances with other corporations in designing or developing certain products; and the market prices of equity securities in Japan, declines in which may result in write-downs of equity securities the companies concerned hold.
Gerard F. Corbett
Hitachi America, Ltd.
Corp. Communications Group
Fax: (650) 244-7920
e-Business Consulting Group
Grant Thornton LLP
John Koegel, Grant Thornton Public Relations
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