MADISON, N.J., Oct. 6, 2021 /PRNewswire/ -- Realogy Holdings
Corp. (NYSE: RLGY), the leading and most integrated provider of
U.S. residential real estate services, today announced a strategic
agreement to form a Title Insurance Underwriter joint venture with
an investment from funds affiliated with Centerbridge Partners,
L.P., a private investment management firm. As part of the
strategic agreement, Centerbridge funds will purchase a controlling
70% interest in Title Resources Guaranty Company, Realogy's
insurance underwriter, for $210
million in cash, subject to closing adjustments, valuing the
asset at $300 million. Realogy will
maintain a 30% equity interest in Closing Parent Holdco, L.P., a
newly formed limited partnership joint venture that will own
the Title Insurance Underwriter. The transaction is expected to
close in first quarter of 2022, subject to required regulatory
clearances and approvals and other closing conditions.
"Realogy continues to demonstrate momentum on our journey to
reimagine an integrated real estate transaction," said
Ryan Schneider, Realogy's
chief executive officer and president. "While we really like our
Title Insurance Underwriter, this agreement enables us to be even
more laser-focused on Realogy's core businesses, including critical
consumer-facing transaction services in franchise, brokerage, title
settlement and escrow, and mortgage."
"We believe a standalone venture guided by Centerbridge's proven
asset growth and management expertise can fully unleash the
underwriter's growth potential, which is why Realogy has committed
to maintaining a material ownership stake," continued
Schneider. "Future growth upside from the underwriter
venture, combined with our ability to unlock capital to further
invest in Realogy's strategic priorities, can help us generate
additional value for both the company and our shareholders."
Kevin
Mahony, Managing Director at Centerbridge
Partners added, "We are excited to partner with Realogy on this
important strategic transaction. We are eager to support CEO
Scott McCall and the talented team
at the Title Insurance Underwriter to realize their vision. The
Title Insurance Underwriter is one of the fastest growing companies
in the sector, delivering an approximately 15% CAGR in gross title
premiums since June 2010. We believe
we can accelerate this growth even further by investing in new
geographies, expanding title products and services, continuing the
development of technology, and delivering value to all
stakeholders, including agents and employees."
Upon close, Centerbridge funds will purchase a 70% equity
interest in the title underwriting joint venture in preferred
units. Realogy's portion of future minority interest earnings from
its 30% common equity stake will be reported within the company's
Realogy Title Group segment, which includes the company's title,
escrow, and settlement services business and mortgage origination
joint venture.
Realogy will continue to own and operate its national scale
title settlement and escrow services that helped agents and
consumers close 214,000 transactions in 2020. Realogy's title and
escrow services operate across 43 states under 45 different brand
names and in 2020, represented the majority of Operating EBITDA
generated by the Realogy Title Group segment, excluding equity
earnings from the company's mortgage origination joint
venture.
Consistent with Realogy's current capital allocation priorities,
the company intends to use the cash proceeds after taxes and
transaction-related costs to continue to invest in its business and
de-lever.
Advisors
Goldman Sachs & Co. LLC served as
financial advisor to Realogy, and Gibson, Dunn & Crutcher
served as legal advisor to Realogy. Bank of America
served as financial advisor to Centerbridge and Willkie Farr & Gallagher served as legal
advisor to Centerbridge.
About Realogy Holdings Corp.
Realogy Holdings
Corp. (NYSE: RLGY) is moving the real estate industry to
what's next. As the leading and most integrated provider of U.S.
residential real estate services encompassing franchise, brokerage,
relocation, and title and settlement businesses as well as a
mortgage joint venture, Realogy supported approximately 1.4 million
home transactions in 2020. The company's diverse brand portfolio
includes some of the most recognized names in real estate:Better
Homes and Gardens® Real Estate, CENTURY
21®, Coldwell
Banker®, Coldwell Banker Commercial®,
Corcoran®, ERA®, and Sotheby's International
Realty®. Using innovative technology, data and
marketing products, high-quality lead generation programs, and
best-in-class learning and support services, Realogy fuels the
productivity of its approximately 194,200 independent sales agents
in the U.S. and approximately 142,700 independent sales agents in
117 other countries and territories, helping them build stronger
businesses and best serve today's consumers. Recognized for ten
consecutive years as one of the World's Most Ethical
Companies, Realogy has also been designated a Great Place to
Work four years in a row and is one of LinkedIn's 2021
Top Companies in the U.S.
About Centerbridge Partners, L.P.
Centerbridge Partners, L.P. is a private investment management firm
employing a flexible approach across investment disciplines —
private equity, private credit and real estate — in an effort to
develop the most attractive opportunities for our investors. The
Firm was founded in 2005 and as of August
31, 2021, has approximately $32
billion in capital under management with offices in
New York and London.
Centerbridge is dedicated to partnering with world-class management
teams across targeted industry sectors and geographies. For
more information, please visit www.centerbridge.com.
Forward-Looking Statements
Certain statements in this press release constitute
"forward-looking statements." Such forward-looking statements
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of
Realogy Holdings Corp. to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Any statements that refer to
expectations or other characterizations of future events,
circumstances or results are forward-looking statements.
Various factors that could cause actual future results and other
future events to differ materially from those in the
forward-looking statements, include, but are not limited to: (i)
the failure to achieve the anticipated benefits of the transaction;
(ii) the conditions to closing the transaction, including the
obtaining of required regulatory clearances, may not be satisfied
on a timely basis or at all; (iii) the transaction may involve
unexpected costs, liabilities or delays; (iv) the business of the
title underwriter may be adversely affected as a result of the
transaction; (v) the joint venture may be adversely affected by
other economic, business and/or competitive factors as well as the
ongoing COVID crisis; (vi) risks that the transaction could disrupt
the title underwriter's plans and operations or adversely affect
employee retention; and (vii) other risks to consummation of the
transaction, including the risk that the transaction will not be
consummated within the expected time period or at all.
Consideration should be given to the areas of risk described
above, as well as those risks set forth under the headings
"Forward-Looking Statements" and "Risk Factors" in the Realogy's
filings with the Securities and Exchange Commission, including
Realogy's Annual Report on Form 10-K for the year ended
December 31, 2020 and Realogy's
Quarterly Report on Form 10-Q for the quarters ended March 31, 2021 and June
30, 2021, and Realogy's other filings made from time to
time, in connection with considering any forward-looking statements
that may be made by Realogy and its businesses generally.
In addition, new risks and uncertainties emerge from time to
time, and it is not possible for Realogy to predict or assess the
impact of every factor that may cause its actual results to differ
from those expressed or implied in any forward-looking statements.
Accordingly, you should not place undue reliance on any
forward-looking statements contained in this press release, and you
should not regard any forward-looking statement as a representation
by Realogy that the future plans, estimates or expectations
currently contemplated by Realogy will be achieved. Realogy
expressly disclaims any obligation to release publicly any updates
or revisions to any forward-looking statements contained herein to
reflect any change in Realogy's expectations with regard thereto or
any change in events, conditions or circumstances on which any
statement is based.
Realogy Investor
Contacts:
|
Realogy Media
Contacts:
|
|
|
Alicia
Swift
|
Trey
Sarten
|
(973)
407-4669
|
(973)
407-2162
|
alicia.swift@realogy.com
|
trey.sarten@realogy.com
|
|
|
Danielle
Kloeblen
|
Gabriella
Chiera
|
(973)
407-2148
|
(973)
407-5236
|
danielle.kloeblen@realogy.com
|
gabriella.chiera@realogy.com
|
|
|
|
|
Centerbridge
Partners Contacts:
|
|
|
|
Jeremy
Fielding
|
|
jeremy.fielding@kekstcnc.com
|
|
|
|
Anntal
Silver
|
|
anntal.silver@kekstcnc.com
|
|
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SOURCE Realogy Holdings Corp.