Benchmark Calls Guidance Software An "Attractive Takeout Candidate"

According to Benchmark, Guidance Software GUID is an attractive takeout candidate. Benchmark said that last week proved to be one of the more eventful weeks for the eDiscovery software market, yielding up two related (and significant) developments that reinforced our oft-stated view that the eDiscovery market is highly fragmented and that M&A in the sector is likely to accelerate as the market consolidates around a handful of vendors. “While we believe GUID is an attractive takeout candidate, we're not convinced management is prepared to entertain potential offers at current valuation levels— GUID trades at 1.4x EV/2011 Revenue. In the past, management stated repeatedly that it has little interest in being acquired. That said, Clearwell-level valuations may make management more inclined to reconsider its strategic options.” Guidance Software closed on Friday at $7.74.