Why Am I Getting A Package From Fidelity National Financial a prominent provider of title insurance and transaction services to the real estate and mortgage sectors, has announced its intention to distribute 15% of the common stock of its wholly-owned subsidiary, F&G Annuities & Life, Inc. (“F&G”), to FNF shareholders on a pro rata basis. F&G specializes in offering annuity and life insurance products and is a leading player in its field. FNF will continue to maintain an 85% ownership stake in F&G and remains committed to fostering the growth and long-term success of F&G.i
This distribution was approved by FNF’s Board of Directors on March 14, 2022, with the aim of realizing the full value potential of both industry-leading businesses. The separation is structured as a taxable dividend to FNF shareholders and is slated for completion in the third quarter of 2022.
William P. Foley, II, Chairman of the Board of FNF, emphasized, “F&G has exceeded all of our expectations, having grown assets under management by 38% to $36.5 billion since our acquisition in June of 2020. FNF’s strong balance sheet has facilitated a credit rating upgrade for F&G and accelerated its growth in new distribution channels. Although F&G’s achievements have surpassed our initial expectations, the market has yet to fully recognize the value we’ve created. We believe that making F&G publicly listed through this dividend to our shareholders is the best way to unlock this value.”
Mike Nolan, Chief Executive Officer of FNF, added, “F&G’s unique position in providing countercyclical revenue, poised to benefit from rising interest rates, has been instrumental in supporting our Company. The acceleration of sales growth and asset management expansion beyond our expectations as F&G enters new markets positions it to generate robust cash flows and earnings for FNF in the years ahead. By retaining 85% ownership of F&G, we can continue to participate in its growth while realizing significant value creation. Importantly, our commitment to F&G, its workforce, and customers remains steadfast.”
Chris Blunt, President and Chief Executive Officer of F&G, remarked, “FNF’s decision to take F&G public through this transaction marks a significant milestone. This move inherently enhances the future value of our corporation and underscores ongoing investments in our business. We’ve transitioned from a $4 billion annual sales retail annuity carrier offering one product through one channel to an insurer with annual sales exceeding $10 billion, offering life, annuities, and institutional solutions across five distinct channels. Becoming a publicly traded company represents a vote of confidence in our business, future potential, and the dedicated efforts of our employees at F&G.”
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Transaction Highlights
The primary objective of this distribution is to enhance and fully realize the market value of both companies. To support F&G’s robust growth prospects, FNF will convert its $400 million intercompany loan to F&G into F&G equity before the distribution. FNF will maintain an 85% ownership stake in F&G while distributing 15% of F&G’s common stock to FNF shareholders to emphasize F&G’s standalone value and enable direct investment in F&G.
Key Transaction Details:
- Chris Blunt will continue to lead F&G as its President and Chief Executive Officer.
- No changes are expected in the strategies, operations, or management teams of FNF or F&G.
- F&G will continue to benefit from FNF’s majority ownership, anticipate robust sales growth as it expands into new distribution channels, and have access to public markets as needed.
- FNF will continue its capital allocation strategy, focused on returning capital to shareholders through quarterly dividends and share repurchases while strategically investing in its business.
Transaction Overview
Upon completion of the distribution, shareholders will hold stock in both publicly traded companies, having received a taxable dividend of 15% of F&G in aggregate. F&G shares will be publicly listed and traded on the New York Stock Exchange. FNF will retain control of F&G with an 85% ownership stake. The distribution is expected to conclude in the third quarter of 2022, subject to various conditions, including final approval by the FNF Board of Directors and regulatory approvals.
This press release does not constitute an offer to sell or a solicitation to buy any securities. BofA Securities, Inc. serves as FNF’s financial advisor for the proposed distribution.
About Fidelity National Financial, Inc.
Fidelity National Financial, Inc. (NYSE: FNF) is a leading provider of title insurance and transaction services for the real estate and mortgage industries. FNF is the largest title insurance company in the United States through its title insurance underwriters – Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title, and National Title of New York. Collectively, they issue more title insurance policies than any other title company in the country.
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About F&G
F&G is part of the FNF group of companies and is dedicated to helping Americans achieve their aspirations. F&G is a prominent provider of insurance solutions serving retail annuity and life customers, institutional clients, and is headquartered in Des Moines, Iowa. For further details, please visit fglife.com.
Forward-Looking Statements and Risk Factors
This press release includes forward-looking statements that entail numerous risks and uncertainties. Statements that are not historical facts, including those regarding our expectations, intentions, or strategies for the future, are considered forward-looking statements, including our ability to complete the spin-off and list on the NYSE. These statements rely on management’s beliefs and current information. Actual results may differ from these projections since they depend on future financial and operational performance rather than being factual statements. We do not commit to updating any forward-looking statements, whether due to new information, subsequent events, or other reasons. Risks and uncertainties that forward-looking statements are subject to include, but are not limited to, diversion of management’s attention, the impact of the F&G transaction on relationships, potential regulatory approvals, changes in economic, business, and political conditions, fluctuations in real estate activity, our ability to find suitable acquisition targets, reliance on distributions from our title insurance underwriters, competition faced by F&G and our operating subsidiaries, extensive government regulation, and other factors detailed in our filings with the Securities and Exchange Commission (SEC), including “Statement Regarding Forward-Looking Information” and “Risk Factors.”
