Posted by goodgirl on 11/8/08 11:11am
Msg #269307
LandAm
I am working part time at another job I really don't like, and everytime it's not busy, they send me home. Great, right... Guess because I'm the low man on the totem pole, I get screwed.
But, in this morning's paper, headline was that Fidelity National is buying out LandAm.
I don't know if anyone mentioned this earlier, so if they did, excuse my dust. Just wanted to make sure everyone knew this.
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Reply by Notary/Guy on 11/8/08 11:27am
Msg #269309
Fidelity National Financial, Inc. and LandAmerica Financial Group, Inc. Announce the Signing of a Definitive Merger Agreement
Jacksonville, Fla. and Richmond, VA -- (November 7, 2008) -- Fidelity National Financial, Inc. (NYSE:FNF) and LandAmerica Financial Group, Inc. (NYSE:LFG) today announced the signing of a definitive merger agreement under which FNF will acquire LFG. Under the terms of the merger agreement, LFG shareholders will receive 0.993 shares of FNF common stock for each share of LFG common stock.
The transaction has been structured to reduce the combined debt of LFG and FNF by approximately $250 million prior to the closing of the merger agreement. This will be accomplished by FNF’s title insurance subsidiaries providing liquidity equal to the statutory book value of LFG’s two primary title insurance subsidiaries, Commonwealth Land Title Insurance Company (“Commonwealth”) and Lawyers Title Insurance Corporation (“Lawyers”), immediately prior to the closing of the merger agreement. These proceeds will be used to repay outstanding indebtedness under LFG’s revolving credit facility and private placement senior notes and, potentially, existing FNF debt. As a result, FNF anticipates no material change from its current debt to total capitalization ratio of approximately 30%.
The transaction is subject to certain closing conditions, including LFG shareholder approval, antitrust and state regulatory approvals, the divestiture of Centennial Bank by LFG and the satisfaction of other customary closing conditions. The merger agreement also provides a due diligence contingency for FNF that expires on November 21, 2008, during which time FNF will conduct due diligence procedures on LFG’s operations and financial condition. Theodore L. Chandler, Jr., LFG’s Chairman and CEO, will join the FNF Board of Directors as Vice Chairman after the closing of the transaction.
In connection with the signing of the merger agreement, Chicago Title Insurance Company (“Chicago Title”), a subsidiary of FNF, has agreed to provide a $30 million stand-by secured credit facility as a means of potential additional liquidity for LFG. The credit facility cannot be drawn upon until the expiration of FNF’s due diligence contingency and will bear interest at a rate of LIBOR + 400 basis points. Any advancement under this facility will be secured by approximately $155 million par value of auction rate securities held by LFG.
“We are very excited to join forces with LandAmerica,” said FNF Chairman William P. Foley, II. “We have always had great respect for LFG and we are confident that the combination of our two companies will create the strongest and most financially sound title insurer in the country, with an unrivaled geographic and commercial footprint. Our preliminary estimate, which must be confirmed during our due diligence period, is that we will realize at least $150 million in operational cost synergies throughout the combined operations, including the areas of corporate and administrative overhead, direct and agency operations and claims management and processing. This merger is a tremendous opportunity for FNF and one that we are confident will create significant long-term value for our shareholders.”
“The unprecedented credit freeze and depressed real estate market have negatively impacted our business to the point that it has become increasingly difficult for LandAmerica to remain an independent public company,” said LFG Chairman and CEO Theodore L. Chandler, Jr. “We are pleased to join the FNF family of companies and believe that this combination is in the best interest of our shareholders, customers and employees. We look forward to the opportunity to bring the strength of our combined capabilities to the marketplace.”
Based on the Demotech Performance of Title Insurance Companies 2008 Edition, the combined company had pro forma 2007 market share of 46.3 percent. The pro forma combined investment portfolio and reserve for claim losses were approximately $5.5 billion and $2.6 billion, respectively, as of September 30, 2008. Pro forma revenue for the nine months ended September 30, 2008 was approximately $5.3 billion.
FNF will hold a conference call to discuss the merger at 11:00 a.m. Eastern Time this morning, Friday, November 7, 2008. Those wishing to participate via the webcast should access the call through FNF’s Investor Relations website at www.fnf.com. Those wishing to participate via the telephone may dial-in at 800-230-1951 (USA) or 612-288-0329 (International). The conference call replay will be available via webcast through FNF’s Investor Relations website at www.fnf.com. The telephone replay will be available from 12:00 p.m. Eastern Time on November 10, 2008, through November 17, 2008, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code will be 969396.
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Reply by 101livescan on 11/9/08 11:28am
Msg #269342
There is not enough real estate loan work out there for all the title companies that we have come to know in this business over the past 20 years. So the big fish is swallowing all the littler fish. When a company like Fidelity has the resources to acquire these "sister" companies, usually there is very little cash involved, the companies are absorbed to avoid bankruptcy. By "merging and acquiring" these smaller companies, it is seamless. All the overhead is cut, the acquisition means that all the assets are acquired, and the expenses are closely disected and examined before any acquisition agreement is finalized. Any redundancy is immediately identified and remedied.
Pretty soon there will only be a few title companies on the radar screen, and of course, Bancserv and FASS process a bulk of the signings for two large title/escrow concerns.
I know that most title companies in my area have cut to the bone and many of the people I have worked for for years, are gone, working in other industries. A couple of title companies, Stewart and United Guarantee have completely disappeared from the Tri Counties.
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