Fidelity to acquire title insurance company Stewart Information for $1.2bn
Insurance acquisition news : Fidelity National Financial (FNF), a Florida-based financial services provider has agreed to acquire Texas-based title insurance company Stewart Information Services for about $1.2 billion.
FNF acquisition of Stewart Information Services, which will be done in a cash-cum-stock deal, is expected to strengthen the residential and commercial title insurance business of the financial services provider.
Stewart Information Services offers residential and commercial title insurance along with closing and settlement services, valuation and appraisal services and other services to the real estate industry.
FNF, on the other hand, also provides title insurance along with transaction services to the real estate and mortgage sectors.
As per the terms of the FNF acquisition of Stewart, the latter’s shareholders will be paid $25.00 in cash and 0.6425 common shares of Fidelity in exchange of each share they hold in the Texas-based title insurance company.
Commenting on FNF acquisition of Stewart, Thomas G. Apel – Stewart’s Chairman of the Board, said: “Last year, our Board initiated a review of strategic alternatives for the company, and after an extensive process, we determined that capitalizing on the Fidelity platform will best enable us to support the Stewart brand and continue providing the service our customers have come to expect.
“Combining with Fidelity National Financial will create a strong portfolio of customers and business relationships, and will provide us with the ability to grow the Stewart brand.”
Currently, FNF plans to fund the Stewart acquisition price with cash on hand, debt financing and the issuance of FNF shares to the stockholders of Stewart stockholders. The deal will also see FNF assume the $109 million of Stewart debt.
William P. Foley, II – FNF Chairman, commenting on FNF acquisition of Stewart, said: “The venerable Stewart brand has a long and respected history in the title insurance industry and we see tremendous potential in working with the Stewart management team to invest in and grow the Stewart brand on a national basis as part of our long-time, successful strategy of operating multiple title insurance brands under the FNF umbrella.”
FNF acquisition of Stewart is likely to be completed in the first or second quarter of 2019, and will be based on meeting of certain closing conditions like the approval from Stewart stockholders to go along with federal and state regulatory approvals.