CoreLogic acquired the Case-Shiller Indexes from Fiserv because it wants to be a leader in valuations and because of the brand value associated with the business, says a CoreLogic executive.
CoreLogic reported in its 1Q13 results that it had acquired Case-Shiller from Fiserv on March 20 for $6 million cash.
Asked why Fiserv sold the well-known company, Fiserv's vice president, communications Judy Wicks issued a statement saying Case-Shiller "is not material" to its operations any more.
"In the unusual event that a business is no longer consistent with our market, product or financial strategies, we would consider a divestiture. As a result, this business, which is not material to Fiserv or its results, was sold in the quarter to CoreLogic."
Fiserv would not comment on the sale beyond this statement.
Ben Graboske, senior vice president, Real Estate & Financial Services at CoreLogic, said in the interview the company has been investing in automated valuation models heavily for the past 15 years. In 2004, it started working in the home price index area.
"We feel that our CoreLogic HPI has been really well received by the marketplace. However, Case-Shiller really defined the space. They pioneered the home price index field. They have got a really strong following and a really strong brand," Graboske said.
He added David Stiff, chief economist for Case-Shiller, will continue to supervise the preparation of the CoreLogic Case-Shiller Indexes and comment on the findings of those indexes.
Mark Fleming, chief economist for CoreLogic, will continue to supervise the preparation of the CoreLogic HPI reports and comment on the findings of those reports.
The economists who lend their names to Case-Shiller, Karl Case and Robert Shiller, currently are members of Standard & Poor's Index committee. Fiserv had acquired Case Shiller Weiss in 2002.
CoreLogic did seek and receive S&P's approval for the deal.
Graboske said CoreLogic had some latitude in disclosing the timing of the deal and elected to wait until its first quarter results call as a way to simplify and consolidate its messaging to investors.