e425
Filed by Fidelity National Financial, Inc. pursuant
to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12 under the
Securities Exchange Act of 1934
Subject Company: LandAmerica Financial Group, Inc.
Commission File No. 001-13990
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PRESS RELEASE |
Fidelity National Financial, Inc. and LandAmerica Financial Group, Inc.
Announce the Signing of a Definitive Merger Agreement
Jacksonville, Fla. and Richmond, VA (November 7, 2008) Fidelity National Financial, Inc.
(NYSE:FNF) and LandAmerica Financial Group, Inc. (NYSE:LFG) today announced the signing of a
definitive merger agreement under which FNF will acquire LFG. Under the terms of the merger
agreement, LFG shareholders will receive 0.993 shares of FNF common stock for each share of LFG
common stock.
The transaction has been structured to reduce the combined debt of LFG and FNF by
approximately $250 million prior to the closing of the merger agreement. This will be accomplished
by FNFs title insurance subsidiaries providing liquidity equal to the statutory book value of
LFGs two primary title insurance subsidiaries, Commonwealth Land Title Insurance Company
(Commonwealth) and Lawyers Title Insurance Corporation (Lawyers), immediately prior to the
closing of the merger agreement. These proceeds will be used to repay outstanding indebtedness
under LFGs revolving credit facility and private placement senior notes and, potentially, existing
FNF debt. As a result, FNF anticipates no material change from its current debt to total
capitalization ratio of approximately 30%.
The transaction is subject to certain closing conditions, including LFG shareholder approval,
antitrust and state regulatory approvals, the divestiture of Centennial Bank by LFG and the
satisfaction of other customary closing conditions. The merger agreement also provides a due
diligence contingency for FNF that expires on November 21, 2008, during which time FNF will conduct
due diligence procedures on LFGs operations and financial condition. Theodore L. Chandler, Jr.,
LFGs Chairman and CEO, will join the FNF Board of Directors as Vice Chairman after the closing of
the transaction.
In connection with the signing of the merger agreement, Chicago Title Insurance Company
(Chicago Title), a subsidiary of FNF, has agreed to provide a $30 million stand-by secured credit
facility as a means of potential additional liquidity for LFG. The credit facility cannot be drawn
upon until the expiration of FNFs due diligence contingency and will bear interest at a rate
of LIBOR + 400 basis points. Any advancement under this facility will be secured by
approximately $155 million par value of auction rate securities held by LFG.
We are very excited to join forces with LandAmerica, said FNF Chairman William P. Foley, II.
We have always had great respect for LFG and we are confident that the combination of our two
companies will create the strongest and most financially sound title insurer in the country, with
an unrivaled geographic and commercial footprint. Our preliminary estimate, which must be
confirmed during our due diligence period, is that we will realize at least $150 million in
operational cost synergies throughout the combined operations, including the areas of corporate and
administrative overhead, direct and agency operations and claims management and processing. This
merger is a tremendous opportunity for FNF and one that we are confident will create significant
long-term value for our shareholders.
The unprecedented credit freeze and depressed real estate market have negatively impacted our
business to the point that it has become increasingly difficult for LandAmerica to remain an
independent public company, said LFG Chairman and CEO Theodore L. Chandler, Jr. We are pleased
to join the FNF family of companies and believe that this combination is in the best interest of
our shareholders, customers and employees. We look forward to the opportunity to bring the
strength of our combined capabilities to the marketplace.
Based on the Demotech Performance of Title Insurance Companies 2008 Edition, the combined
company had pro forma 2007 market share of 46.3 percent. The pro forma combined investment
portfolio and reserve for claim losses were approximately $5.5 billion and $2.6 billion,
respectively, as of September 30, 2008. Pro forma revenue for the nine months ended September 30,
2008 was approximately $5.3 billion.
FNF will hold a conference call to discuss the merger at 11:00 a.m. Eastern Time this morning,
Friday, November 7, 2008. Those wishing to participate via the webcast should access the call
through FNFs Investor Relations website at www.fnf.com. Those wishing to participate via the
telephone may dial-in at 800-230-1951 (USA) or 612-288-0329 (International). The conference call
replay will be available via webcast through FNFs Investor Relations website at www.fnf.com. The
telephone replay will be available from 12:00 p.m. Eastern Time on November 10, 2008, through
November 17, 2008, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code
will be 969396.
Fidelity National Financial, Inc. is a leading provider of title insurance, specialty
insurance, claims management services and information services. FNF is one of the nations largest
title insurance companies through its title insurance underwriters Fidelity National Title,
Chicago Title, Ticor Title, Security Union Title and Alamo Title that issue approximately 27
percent of all title insurance policies in the United States. FNF also provides flood insurance,
personal lines insurance and home warranty insurance through its specialty insurance business. FNF
also is a leading provider of outsourced claims management services to large corporate and public
sector entities through its minority-owned subsidiary, Sedgwick CMS. FNF is also a leading
information services company in the human resource, retail and transportation markets through
another minority-owned subsidiary, Ceridian Corporation. More information about FNF can be found
at www.fnf.com.
LandAmerica Financial Group, Inc. is a leading provider of real estate transaction services
with offices nationwide and a vast network of active agents. LandAmerica serves agent,
residential, commercial and lender customers throughout the United States, Mexico, Canada, the
Caribbean, Latin America, Europe and Asia. LandAmerica is recognized as number one in the
mortgage services industry on Fortunes® 2007 and 2008 lists of Americas Most Admired Companies.
In connection with the proposed merger, FNF will file with the SEC a Registration Statement on
Form S-4 that will include a proxy statement of LFG that also constitutes a prospectus of FNF. LFG
will mail the proxy statement/prospectus to its stockholders. FNF AND LFG URGE INVESTORS AND
SECURITY HOLDERS TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED MERGER WHEN IT
BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. You may obtain copies of all
documents filed with the SEC regarding this transaction, free of charge, at the SECs website
www.sec.gov. You may also obtain these documents, free of charge, from FNFs website at
www.fnf.com under the tab Investor Relations and then under the item SEC Filings. You may also
obtain these documents, free of charge, from LFGs website at www.landam.com under the heading
Investor Information and then under the tab SEC Filings. FNF, LFG and their respective
directors, executive officers and certain other members of management and employees may be
soliciting proxies from LFG stockholders in favor of the merger. Information regarding the persons
who may, under the rules of the SEC, be deemed participants in the solicitation of such
stockholders in connection with the proposed merger will be set forth in the proxy
statement/prospectus when it is filed with the SEC. You can find information about FNFs executive
officers and directors in its definitive proxy statement filed with the SEC on April 15, 2008. You
can find information about LFGs executive officers and directors in its definitive proxy statement
filed with the SEC on March 24, 2008. You can obtain free copies of these documents from FNF and
LFG using the contact information above.
This document shall not constitute an offer to sell or the solicitation of an offer to buy any
securities, nor shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification under the securities
laws of any such jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
This press release contains forward-looking statements that involve a number of risks and
uncertainties. Statements that are not historical facts, including statements about our beliefs
and expectations, are forward-looking statements. Forward-looking statements are based on
managements beliefs, as well as assumptions made by, and information currently available to,
management. Because such statements are based on expectations as to future economic performance
and are not statements of fact, actual results may differ materially from those projected. We
undertake no obligation to update any forward-looking statements, whether as a result of new
information, future events or otherwise. The risks and uncertainties which forward-looking
statements are subject to include, but are not limited to: the possibility that the proposed merger
will not be completed due to the failure to secure necessary regulatory approvals, or due to the
outcome of FNFs due diligence review; the possibility that there are unexpected delays in
obtaining regulatory approvals; the failure to obtain approval of LFGs shareholders; the
possibility that the revenues, cost savings, growth prospects and any other synergies expected from
the proposed transaction may not be fully realized or may take longer to realize than expected;
changes in general economic, business and political conditions, including changes in the financial
markets; continued weakness or adverse changes in the level of real estate activity, which may be
caused by, among other things, high or increasing interest rates, a limited supply of mortgage
funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates,
acquisitions in lines of business that will not necessarily be limited to our traditional
areas of focus, or difficulties in integrating acquisitions; our dependence on operating
subsidiaries as a source of cash flow; significant competition that our operating subsidiaries
face; compliance with extensive government regulation of our operating subsidiaries; and other
risks detailed in the Statement Regarding Forward-Looking Information, Risk Factors and other
sections of the Companys Form 10-K and other filings with the Securities and Exchange Commission.
SOURCES: Fidelity National Financial, Inc. and LandAmerica Financial Group, Inc.
CONTACTS: FNF: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120,
dkmurphy@fnf.com; LFG: Bill Evans, Chief Financial Officer, 804-267-8114, bevans@landam.com