March 06, 2013

Hitachi Systems and Sunway Technology of Malaysia Establish IT Services Joint Venture

Tokyo, Petaling Jaya, March 6, 2013 – Hitachi Systems, Ltd., a wholly owned subsidiary of Hitachi, Ltd. (TSE: 6501), today announced that it has agreed with Sunway Technology, an established information technology (IT) solutions provider in Malaysia, to establish an IT service joint venture in Southeast Asia, with emphasis on Malaysia.

Sunway Technology encompasses a group of IT companies which provides installation and sale of Product Lifecycle Management (PLM) and Enterprise Resource Planning (ERP) packages, provision of virtualization, cloud solutions and services, data center outsourcing, and information technology outsourcing services. Since its establishment in 1984, Sunway Technology has been providing solutions and services to more than 800 organisations in Southeast Asia which operate in various industries such as financial services, healthcare, automotive, oil & gas, construction, retail & distribution and manufacturing. Sunway Technology, is a privately owned entity of Sunway Group, one of Malaysia’s most formidable property-construction conglomerates with a multitude of established businesses in more than 40 locations worldwide, and has been providing core IT services for almost three decades to the latter as its IT partner, and continues to enhance and expand its business.

In line with continued economic growth in Southeast Asia, a host of international firms, Japanese companies among them, are advancing into the region. Consequently, demand for IT services is rising, including among local companies. Similarly, the Hitachi Group is accelerating its own business development in Southeast Asia as it aims to generate consolidated revenues of ¥200 billion from the Information & Telecommunication Systems business in China and the rest of Asia in fiscal 2015. In this context, Hitachi Systems is targeting consolidated revenues of ¥500 billion and an overseas sales ratio of 10% in fiscal 2015. Under its medium-term management plan, Hitachi Systems is pursuing various measures including “GNEXT” global IT services supporting Japanese companies that are expanding operations globally, cooperating with Singapore-based Hitachi Asia Ltd. and other Hitachi Group companies in Southeast Asia.

Against this backdrop, Hitachi Systems and Sunway Technology will jointly establish an operating company for the provision of IT services in Malaysia and throughout Southeast Asia. Specifically, the operations of several Sunway Technology’s subsidiaries will be consolidated under Sunway E-Systems, a wholly owned subsidiary of Sunway Technology. Hitachi Systems will then acquire 51% of Sunway E-Systems’ shares from Sunway Technology, making Sunway E-Systems a joint venture. The name of the JV company will be Hitachi Sunway Information Systems (subject to approval from the relevant authorities). In this capacity, in addition to the existing subsidiaries in Singapore, Thailand, Indonesia and Philippines, Sunway E-Systems will also form a subsidiary in Vietnam this year.

Through this joint venture, Hitachi Systems and Sunway Technology will expand marketing to both Japanese and local companies around PLM and ERP packages, virtualization, cloud solutions, data center outsourcing and IT outsourcing services. Hitachi Systems will take advantage of the joint venture’s base network to further expand sales of its GNEXT global IT services, and will globally develop its IT business through partnerships with Sunway Technology, as well as with Hitachi Asia, Hitachi eBworx and other Hitachi Group companies in Southeast Asia.

This symbiotic joint-venture between Sunway Technology and Hitachi Systems will create a bigger pool of resources and allow both to leverage on each others’ expertise, strengths and networks to cater to more demands in the bigger market reach.