Jacksonville, Fla. -- (July 13, 2011) -- Fidelity National Financial, Inc. (NYSE:FNF), a leading provider of title insurance, mortgage services, specialty insurance and diversified services, today announced the signing of a definitive agreement under which it will sell its flood insurance business to WRM America Holdings LLC ("WRM America").
Under the terms of the definitive agreement, WRM America will acquire 100 percent of the equity interests of Fidelity National Indemnity Insurance Company ("FNII") and Fidelity National Insurance Services for approximately $210 million, consisting of approximately $122.5 million in cash, $75 million in a seller note and approximately a $12.5 million cash dividend that FNII intends to pay to FNF prior to closing. The seller note will have an 8 percent annual interest coupon, interest payable quarterly and principal payable in full as a balloon payment eighteen months from closing. The sale price is subject to typical closing adjustments based on working capital and surplus. The closing of the transaction is subject to regulatory approval and customary closing conditions and is expected during the fourth quarter of 2011. The flood business sale is expected to result in approximately a $154 million pre-tax gain for FNF.
"Our flood insurance business has been the nation's largest flood insurance provider and a very profitable and consistent business for FNF for nearly ten years," said Chairman William P. Foley, II. "We feel this transaction is a great opportunity to realize the value of the business we have created and redeploy the capital into other uses that can continue to create increased value for our shareholders. We are proud of the flood insurance business we created and we wish them future success with their new investment partners."
Fidelity National Financial, Inc. (NYSE:FNF), is a leading provider of title insurance, mortgage services, specialty insurance and diversified services. FNF is the nation's largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title and Alamo Title - that collectively issue more title insurance policies than any other title company in the United States. FNF also provides personal lines insurance and home warranty insurance through its specialty insurance business. In addition, among other operations, FNF owns minority interests in Ceridian Corporation, a leading provider of global human resources, payroll, benefits and payment solutions and Remy International, Inc., a leading designer, manufacturer, remanufacturer, marketer and distributor of aftermarket and original equipment electrical components for automobiles, light trucks, heavy-duty trucks and other vehicles. More information about FNF can be found at www.fnf.com.
Forward Looking Statements
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; weakness or adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; our dependence on distributions from our title insurance underwriters as a main source of cash flow; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries; and other risks detailed in the "Statement Regarding Forward-Looking Information," "Risk Factors" and other sections of the Company's Form 10-K and other filings with the Securities and Exchange Commission.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120, firstname.lastname@example.org