OpenText acquires Recommind
Having first entered into a strategic alliance with Recommind in 2008, listed software giant OpenText has entered into a definitive agreement to acquire the eDiscovery and analytics leader for $163m.
The all cash acquisition by the former legal document management system leader, which has over 50 offices across Canada, EMEA, Latin America and the USA, will enable OpenText to fully establish itself within the growing eDiscovery sector and leverage Recommind’s cloud and analytics capability across its business.
OpenText, which is NASDAQ and Toronto Stock Exchange-listed and has grown through a series of acquisitions, said one strategic rationale for this latest deal is that Recommind has “strong recurring revenues with established customer relationships based on multi-year cloud managed services and SaaS offerings.”
Recommind’s SaaS and managed services solutions include Axcelerate for eDiscovery review and analysis, which includes predictive coding; Perceptiv for contract analytics; and Decisiv for enterprise-wide information access.
Its alliance with OpenText has seen the pair leverage the early case assessment capability of Axcelerate Legal Hold within OpenText’s enterprise content management suite. The integration allows enterprises to quickly identify and collect data directly from within the ECM suite – a powerful combination given the pressure on organisations to manage information for regulatory, investigatory and litigation purposes and to be able to quickly respond to potential lawsuits.
The transaction, which is expected to generate between $70-$80m of annual revenues, is expected to close in the first quarter of fiscal 2017 and is subject to regulatory approval and closing conditions.
It is OpenText’s most notable acquisition, as far as the legal sector is concerned, since its purchase of rival DMS supplier Hummingbird in 2006, which saw it outbid Symphony Technology Group.
OpenText, which counts Hogan Lovells, Allen & Overy, Eversheds, Gowlings (now Gowling WLG), Travers Smith and Baker Hostetler among its law firm clients, was up until around 2010 one of the two giants of the legal DMS world, battling for status alongside then Autonomy iManage, which as of 2011/12 achieved clear market leader status.
With the rapid growth of eDiscovery and the recent green light from the UK courts for predictive coding, this is a serious legal play.
More to follow.