Fidelity National Financial to Split Into 2 Separate Publicly Traded Companies

April 27, 2006

JACKSONVILLE, Fla. (AP) -- The market granted immediate approval to the announcement of a corporate reshuffling at Fidelity National Financial Inc., sending shares up 17 percent Thursday.

Fidelity, a provider of insurance services such as claims and risk management, said Thursday it plans to spin off a bundle of its business operations into a separate publicly traded company. The company's board of directors formed a special committee to evaluate proposals for the restructuring, which entails eliminating the holding company and splitting its divisions into two corporations.

Under the proposal announced Thursday, the holding company will transfer its specialty insurance business and some other assets to its Fidelity National Title division and spin the subsidiary off to Fidelity shareholders as a public company. Fidelity will retain no ownership in the new company. Terms of the spinoff have not been set, but the holding company expects stock consideration in the range of $1 billion to $1.25 billion.

The parent company will then consolidate its remaining operations into its Fidelity National Information Services Inc. subsidiary, and eliminate the parent holding company. The transaction will leave two corporations: Fidelity National Information Service Inc., which will trade under the ticker FIS, and Fidelity National Financial, which will trade under the ticker FNF.

Shares of Fidelity rose $5.96, or 17 percent, to $40.95 in morning trading on the New York Stock Exchange. The company's shares have traded in a range of $31.05 and $45.56 in the past year.

Fidelity Chief Executive William P. Foley said the company believes the market is undervaluing some of Fidelity's individual components. The company hopes the transaction will simplify Fidelity's assets for investors and eliminate the discount.

Foley will remain chairman and CEO at the new Fidelity National Financial, which will consist of the title insurance, specialty insurance and Sedgwick business lines. Fidelity National Financial will pay an annual dividend of $1.16, the company said. Lee Kennedy will continue serving as CEO of Fidelity National Information Services.

Bear, Stearns & Co. is advising on the transactions.

Coopyright 2006 Associated Press


Contact ALTA at 202-296-3671 or communications@alta.org.

SoftPro, based in Raleigh, NC, offers a mature suite of products, designed specifically for the closing and title industry. Our mission is to serve our client base, with best-in-class products and services. Our products are modular so we don't force you to buy anything you don't need. You can always add on as your business grows. Unlike other software companies, we view the sale as the beginning of the relationship rather than the end. North American Title Insurance Company (NATIC) is a seasoned title insurance underwriter, helping title agents to achieve their individual business goals for more than 50 years. Today, the company conducts real estate settlement services in 39 states and the District of Columbia through a network of experienced, independent agents.