Legacy systems are valuable assets for organisations. They continuously evolve with new emerged technologies in rapidly changing business environment. Web services, together with service-oriented architectures, facilitate legacy system webification and evolution in service-oriented computing environment. Traditional approaches to integrate legacy systems with Web service technology are wrapping a legacy system as a black-box without adequate system understanding. In this paper, we proposed a reengineering approach which applies an improved agglomerative hierarchical clustering algorithm to restructure legacy code and to facilitate legacy code extraction for Web service construction. It supports service identification and service packaging and archives legacy system migration into service-oriented architectures by providing functional legacy code as Web services.