Hitachi Ltd <6501.T> said on Thursday it has bought struggling California-based network storage company BlueArc Corp in an all-cash transaction after a five-year OEM partnership, in the latest such move to take advantage of the yen's strength.

Hitachi did not reveal the cost of the acquisition, but Japan's Asahi newspaper said it was about $500-600 million.

The yen hit a record high 75.94 yen to the dollar last month, compared with about 85 yen a year ago, making overseas acquisitions cheaper for Japanese firms. On Thursday it traded around 77.40 yen.

Last month Asahi Group Holdings <2502.T> said it was acquiring New Zealand beverage group Independent Liquor for $1.3 billion.

Bringing BlueArc into the Hitachi family will enable us to better serve customers with more tightly integrated technologies, broader capabilities and deeper expertise globally, Hitachi Data Systems chief executive Jack Domme said in a news release posted on the company's website.

Hitachi's move comes after BlueArc filed with U.S. regulators in June for an initial public offering to raise up to $100 million, saying in its regulatory filing it had been posting losses since 2003 and expected to continue to do so.

Wells Fargo Securities was the exclusive financial adviser to Hitachi Data Systems in the buyout, while BofA Merrill Lynch acted as financial adviser and Credit Suisse as a co-adviser to BlueArc, Hitachi said on its website.

Shares in Hitachi were up 0.5 percent at 395 yen in early afternoon trade, while the benchmark Nikkei Average <.N225> was up 0.3 percent.

(Reporting by Isabel Reynolds; Editing by Michael Watson)

Japan Manufacturing Nikkei 225