JACKSONVILLE, Fla. Title insurance giant Fidelity National Financial said it is acquiring Lender Processing Services, just four years after its sister company, Fidelity National Information, spun off LPS, the nation’s largest provider of mortgage processing services.
Fidelity National Financial is paying about $2.9 billion in cash and stock as it tries to grow its mortgage servicing business.
In 2009, Lender Processing was spun off from Fidelity National Information Services, which itself was spun off two years before from Fidelity National Financial, the giant title insurance company. The three separate publicly owned companies all are run out of the same offices in Jacksonville now.
Fidelity National Information Services, or FIS, was formed in 2006 in a merger between an FNF unit and credit union card service company Certegy Inc.
FNF now owns a number of restaurant chains, an automotive business and a payment solutions business, apart from its core insurance businesses. The company said it plans to merge its ServiceLink business with LPS, and sell a 19% stake in the combined company to private equity firm Thomas H. Lee Partners for about $381 million.
“We have set a target of $100 million for cost synergies and are confident that we can meet or exceed that goal,” FNF Chairman William Foley said in a statement.
FNF said the deal would add 11.3% to its pro-forma 2012 net earnings.
“We have significant experience and familiarity with LPS from our previous ownership of these businesses. This combination will create a larger, broader, more diversified and recurring revenue base for FNF,” Foley said.
