First American Acquires Majority Interest in Matrix Asset Management
September 13, 2004
Addition Completes First American's Full Suite of Default Outsource Services
SANTA ANA, Calif., /PRNewswire-FirstCall/ -- The First American Corporation (NYSE: FAF) and Matrix Bancorp, Inc. (Nasdaq: MTXC) jointly announced that First American has acquired a 75 percent equity ownership interest in its subsidiary, Matrix Asset Management, in exchange for a combination of cash and notes totaling approximately $15 million. The transaction will be immediately accretive to First American.
Established in 1995, Matrix Asset Management is the nation's second largest asset-management outsource company. Matrix offers asset disposition and default management services on foreclosed properties to mortgage bankers, investment bankers and financial institutions across the United States.
"Asset management services are an important element of offering a complete default management solution," said Parker S. Kennedy, president and chief executive officer of The First American Corporation. "The demand for outsourced default management services is growing rapidly as large and middle-tier mortgage lenders are increasingly looking to streamline their operations and have complex services managed by experts. Matrix's strong reputation and client base offer tremendous growth opportunities for our default-related businesses, and will also help to drive additional business to our title and property valuation operations."
First American is the nation's number-one provider of outsourced default services, and Matrix Asset Management is a valuable addition as it completes First American's suite of default products and services. With approximately $320 million in assets under management, Matrix will maintain its central operations center in Denver.
Kenneth Blevins, president of Matrix Asset Management said: "This is an excellent move for our customers and helps to position our company for continued growth. First American is the market leader in providing a comprehensive set of default and mortgage origination services. By joining with First American, we can deliver great value to our customers while offering them an expanded line of related products and services including First American's industry-leading product bundles."
Dennis J. Gilmore, executive vice president of First American stated: "The addition of Matrix Asset Management gives us the ability to provide our clients with individual services or complete end-to-end solutions. Matrix's solid and experienced team of professionals and central location make it ideal to support First American's default-related services and real estate-owned (REO) property management needs nationwide."
Matrix Bancorp, which will retain a 25 percent interest in Matrix Asset Management, is a unitary thrift holding company headquartered in Denver with subsidiaries conducting operations primarily in Colorado, Arizona and Texas.
"Matrix Bancorp is working hard to strengthen shareholder value as we streamline our company and focus on our core businesses," said Rick Schmitz, chief executive officer of Matrix Bancorp. "We have great faith in Matrix Asset Management and the upside potential for the company as it is now paired with First American. It was important to us that we maintain a minority interest in the company so that our shareholders can continue to participate in the unit's growth."
Source: The First American Corporation