FIRST AMERICAN FINANCIAL AND EXPERIAN TO FORM COMPANY Venture will be the leader ...
September 10, 1997, SANTA ANA, CALIFORNIA
The combination of First American Real Estate Information Services, Inc. (Information Services) and Experian’s Real Estate Solutions (Experian RES) will be the nation’s largest and most diverse provider of information technology and decision support solutions for the mortgage and real estate industries. It will have annual revenues of more than $450 million and a combined staff of 4,000. The venture will combine RES’s property data and title information services with all of Information Service’s businesses, with the exception of Excelis, Inc., the mortgage loan servicing software division. First American Financial and Experian management expect the transaction to be accretive to the earnings of both companies.
The transaction is expected to close by year end. The companies are drafting and negotiating definitive agreements. The closing of the transaction is subject to certain regulatory approvals. No financial terms were released. The new company will be headquartered in St. Petersburg, Florida, the current headquarters of Information Services.
In making the announcement, Parker S. Kennedy, president of First American Financial, said, "The combination of our two organizations will redefine the mortgage lending services industry. First American is already the leading provider of real estate-related financial and information services. Experian RES is our primary information supplier and a recognized innovator of automated valuation and real property database products. This is an extraordinary marriage of two very compatible companies, providing a unique opportunity to combine the biggest property raw data provider with the biggest repackager and reseller of property information. The efficiencies will be substantial."
Experian RES is America’s foremost supplier of core real estate data, providing, among other things, property valuation information, title information, tax information, and imaged title documents. First American Financial’s appraisal, tax service and title businesses, together, make it Experian RES’s largest customer. First American CREDCO, which will be a part of the new company, is the nation’s largest provider of mortgage credit information and a large Experian consumer credit customer.
"This is an opportunity to accelerate our transformation from a data supplier to an integrated solutions provider," said D. Van Skilling, chairman and CEO of Experian North America. "We look at this as a wonderful opportunity to expand our commitment to the real estate industry. Our new company will have significant economies of scale, a total focus on a single market and two financially strong parents – all of which will enable us to do more for clients."
There are three categories of business that will be especially impacted by the combination of these two companies: appraisal, tax servicing, and title services. Experian RES maintains the nation’s largest property database and provides comparable sales, tax and assessor’s map information used in the production of electronic appraisals; First American is the second largest appraisal provider in the country. RES provides tax information to tax service companies, Realtors and title companies; First American operates the second largest national tax service company and also provides tax information to title companies. RES is the number one operator of title plants with the largest repository of imaged title documents; First American is the leading title insurance company in the U.S. The new company will also take over the operations of Information Services’ credit reporting, flood compliance, field inspection and mortgage document preparation services.
John Long, president of Information Services, will be president of the new company. "With the combination of these two powerhouses, we will deliver an unparalleled level of services and technology that will enhance lender efficiency today, and develop new products and electronic commerce solutions for the future," Long said.
The First American Financial Corporation, based in Santa Ana, California, is the nation’s leading provider of real estate-related financial and information services. The corporation’s subsidiaries include First American Title Insurance Company, a national and international title insurer; First American Real Estate Information Services, Inc., which offers tax reporting and certification, credit reporting, flood certification, mortgage loan servicing systems, appraisal services, mortgage document preparation and field inspection services nationally; First American Home Buyers Protection Corporation, a home warranty company; and First American Capital Management, an investment advisory firm. The corporation also operates First American Trust Company and First Security Thrift Company in Southern California. First American Financial has more than 10,000 employees in over 400 branch offices in the United States and abroad. Information about the company’s subsidiaries and an archive of its press releases can be found at http://www.firstam.com on the Internet.
Experian was formed in November 1996 from the combination of Experian and the CCN Group. Experian employs about 7,000 people in more than 80 offices in the United States, United Kingdom, Continental Europe, Africa and Asia Pacific. Proforma sales in fiscal year 1996/97 (April 1, 1996 – March 31, 1997) were $890 million. The merged companies are headquartered in Orange, Calif., and Nottingham, U.K. Experian is the world’s leading supplier of consumer credit information and solutions. With its acquisition of Direct Marketing Technology Inc. in April 1997, Experian became one of the largest companies in the direct marketing industry worldwide. Direct Tech generated $65 million in sales in fiscal 1996, which ended November 30. For business details, credit products and practical information about managing credit, visit the company online at www.experian.com.