Fidelity National Financial, Inc. announced that it had signed a definitive agreement to purchase Chicago Title Corporation for approximately $1.2 billion or $52.00 per share of Chicago Title common stock using approximately equal amounts of cash and stock. The allocation between cash and stock will be adjusted so Chicago Title stockholders will receive more than 50% of the outstanding stock of the new company. The $52.00 price for each Chicago Title share, represents a 42% premium to the closing price of the stock on July 29, 1999, the day before the parties announced holding discussions. The price is payable in Fidelity National Financial shares or, upon election by Chicago Title stockholders, in cash, subject to proration as may be necessary to achieve the allocation between cash and stock described above.

"The addition of Chicago Title's operations, products and skills to Fidelity's industry leading productivity strengths will result in the creation of a preeminent competitor in the title insurance industry. The new company will also be a premier player in the rapidly growing area for real estate information services, accommodating customers that may desire "one-stop-shopping for all of their service needs," said William P. Foley II, Chairman and Chief Executive Officer of Fidelity. "Following the closing of the transaction, we fully intend to maintain the Chicago Title and Fidelity National title insurance brands and run the two operations separately. This will allow Chicago Title employees and customers to enjoy the expanded benefits and opportunities of being a part of a market leader, without losing any of the qualities that make Chicago Title such a successful company."

He went on to add, "This merger is an indication of Fidelity's desire to be a key player in the title industry. Fidelity will have a significant presence in many of the largest states including California, Texas, New York, Florida and Illinois. Fidelity will also be one of the largest agency and commercial and industrial underwriters. From a financial perspective, Fidelity will have one of the largest investment portfolios as well as one of the largest equity bases of anyone in the industry."

The transaction is subject to approval by the stockholders of Chicago Title and Fidelity, requisite regulatory authorities and other customary conditions and is expected to be completed in the first quarter of 2000. The combined company, which will have the Fidelity National Financial name, will have approximately 1000 office locations across the country and a gross revenue base (including agency revenue) of over $3.2 billion based on 1998 data. This transaction more than doubles the size of Fidelity and puts it at the forefront of the title insurance industry. Based on 1998 combined title revenue levels, Fidelity National Financial will be the largest title insurance company in the United States.

Published: August 3, 1999

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