OREANDA-NEWS. March 28, 2011. Hitachi, Ltd. (NYSE:HIT / TSE:6501) today announced that two companies within its Information & Telecommunication Systems Company – Hitachi Electronics Services Co., Ltd. ("HES") and Hitachi Information Systems, Ltd. ("Hitachi Joho") – have agreed to merge effective October 1, 2011, and will be rebranded as "Hitachi Systems, Ltd." (provisional name, "the new company"). By consolidating their management resources, the two companies will leverage their combined strengths to reinforce the structure for providing one-stop solutions to support the entire IT life cycle, ranging from consulting for systems installation to operation and maintenance.

The IT environment has undergone major changes in recent years, including the appearance of cloud computing and other new service platforms, as well as advances in network technologies. In addition, the IT systems needs of customers are diversifying as businesses globalize and business models become more complex.

To respond to these changes, Hitachi has been strengthening its information and telecommunication systems business, which is a core competency within Hitachi. The information and telecommunications sector is a key component of Hitachi's Social Innovation Business, and this move also supports Hitachi's focus on expanding its Social Innovation Business. In February 2010, Hitachi Software Engineering Co., Ltd. ("Hitachi Software"), Hitachi Systems & Services, Ltd. ("Hitachi Systems"), and Hitachi Joho were made wholly owned subsidiaries, and in October Hitachi Software and Hitachi Systems were merged to create Hitachi Solutions, Ltd. Through these measures, Hitachi has strengthened its business structure by concentrating management resources, to respond to changes in the IT environment and the diversification of customer needs. This merger of HES and Hitachi Joho is intended to further strengthen the information and telecommunication systems business.

HES has 320 domestic service sites, and the company is highly regarded for its high-quality IT management and maintenance services that are closely tied to customers in the field and platform business solutions, which utilize the company's support capabilities. At the same time, Hitachi Joho has a wealth of experience and expertise in the proposal, design, and construction of operational systems, especially for local governments and the manufacturing and distributions industries. It also has a proven track record at the data centers it currently operates throughout Japan.

Through this merger, the new company will concentrate the management resources developed by both companies over their histories to strengthen the structure for providing one-stop solutions that are tailored to customers in all regions throughout Japan, and add value to Hitachi's systems operation and maintenance services. The new company will also reinforce the foundation for the cloud computing business, primarily through the data center services business, while at the same time further expanding the domestic business that is backed by roughly 50 years of experience at both companies, and strengthening the global business by providing support to Japanese companies as they expand overseas.