Filed by Capitol Investment Corp. V
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Doma Holdings, Inc.
Commission File No. 001-39754
Doma eyes title agency acquisitions, vertical expansion
following SPAC merger — CEO
10:20 EDT, June 25 2021
Doma, a real estate technology company, expects to target
select title agencies across the US and could consider acquisitions
to launch into adjacent verticals, said CEO Max Simkoff.
The San Francisco-based company, formerly known as States Title,
expects to target medium-scale agencies with topline revenue of
about USD 50m and around a 10% EBITDA margin, Simkoff said.
Doma has made one acquisition before, purchasing North American
Title Group’s underwriting and the majority of its local business
back in 2019, and it expects to ramp up the strategy following its
merger with special purpose acquisition company (SPAC) Capitol
Investment V [NYSE:CAP]. Doma will have a significant amount of
additional capital on its balance sheet — it closed a USD 300m
public investment in private equity (PIPE) as part of the deal —
and it is in a market with many potential targets, Simkoff
said.
The company is geographically agnostic regarding its title agency
search and is more interested in where opportunities present
themselves at the right price and scale, the CEO said. It expects
to look at purchase agency opportunities more so than refinance
given the momentum it has demonstrated in strategic accounts, he
added.
Doma uses machine intelligence and patented technology to make real
estate closings simpler and more efficient. It has offerings in
title, escrow and close, and Simkoff spoke in a recent earnings
call of plans to expand into the immediate market adjacencies of
appraisal and home warranty.
While it is possible the company could acquire to launch into those
markets, it is “too early to tell”, Simkoff said. Doma has no plans
to acquire in either adjacency yet and would look at deals
opportunistically right now, he added.
The USD 8bn appraisal ecosystem is top of mind, Simkoff said,
noting that there are potentially interesting companies in that
space that could become targets.
Doma posted a 101% year-over-year increase in adjusted gross profit
in 2020 to USD 29m, according to recent filings. It expects USD 89m
in adjusted gross profit this year. Retained premiums and fees last
year totaled USD 189.7m, compared with USD 179.8m in 2019. The
company expects USD 226.4m in retained premiums and fees for
2021.
Its strategic and enterprise accounts channel grew 537% year over
year in the first quarter. That business line has some of the
largest bank and non-bank lenders in the US, including Wells
Fargo [NYSE:WFC]. It covers about 76% of the country based on
gross written premium, with a presence in Arizona, California,
Nevada, Florida, Georgia, New Jersey, Pennsylvania, Massachusetts,
South Carolina, Wisconsin and Texas.
Doma’s “immediate focus” and biggest single-state expansion is in
New York, the only state the company is not licensed as an
underwriter or an agent, according to Simkoff. Oregon and
Washington are also of interest because they have meaningful
volumes in mortgage origination, particularly in refinance, he
added.
SPAC provided control of public debut
Doma was receiving inbound interest last fall across a variety of
channels, Simkoff said. It initially assessed whether it wanted to
be a public company, which, based on its momentum and the market,
was a “very clear yes,” he noted.
It considered a traditional initial public offering and a direct
listing but chose the SPAC route because of the control it provided
over the process and investor selection, the CEO said. The SPAC
option also allowed Doma to discuss potential future growth, which
was important for a company that jumped from generating its first
revenue in 2018 to posting USD 190m in retained premium and fees
two years later, Simkoff added.
The company announced its merger with Capitol Investment V in March
in a deal valuing it at USD 3bn.
Choosing a SPAC partner that had prior experience was important
amid a market flooded with new entrants, Simkoff said. It did not
host an auction during the SPAC process and chose Capitol after
speaking with several potential partners, he added.
Citigroup Global Markets was Doma’s financial advisor, and
Davis Polk & Wardwell was its legal advisor. J.P.
Morgan Securities was Capitol’s financial advisor, Latham
& Watkins was its legal advisor, and Deutsche Bank
Securities was the SPAC’s capital markets advisor.
IMPORTANT LEGAL INFORMATION
Additional Information and Where to Find It
This communication relates to a proposed transaction between Doma
Holdings, Inc. (“Doma”) and Capitol Investment Corp. V (“Capitol”).
This communication does not constitute an offer to sell or
exchange, or the solicitation of an offer to buy or exchange, any
securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, sale or exchange 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. Capitol has filed a registration statement on Form S-4
with the U.S. Securities and Exchange Commission (the “SEC”), which
includes a document that serves as a prospectus and proxy statement
of Capitol, referred to as a proxy statement/prospectus. A proxy
statement/prospectus will be sent to all Capitol stockholders.
Capitol also will file other documents regarding the proposed
transaction with the SEC. Before making any voting decision,
investors and security holders of Capitol are urged to read the
registration statement, the proxy statement/prospectus and all
other relevant documents filed or that will be filed with the SEC
in connection with the proposed transaction as they become
available because they will contain important information about the
proposed transaction.
Investors and security holders may obtain free copies of the
registration statement, the proxy statement/prospectus and all
other relevant documents filed or that will be filed with the SEC
by Capitol through the website maintained by the SEC at
www.sec.gov.
The documents filed by Capitol with the SEC also may be obtained
free of charge at Capitol’s website at
https://www.capinvestment.com/ or upon written request to 1300
17th Street North, Suite 820, Arlington, Virginia
22209.
Participants in Solicitation
Capitol and Doma and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from Capitol’s stockholders in connection with the proposed
transaction. A list of the names of such directors and executive
officers and information regarding their interests in the business
combination is contained in the proxy statement/prospectus. You may
obtain free copies of these documents as described in the preceding
paragraph.
Forward-Looking Statements Legend
This communication includes “forward-looking statements” within the
meaning of the “safe harbor” provisions of the United States
Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as
"estimate," "plan," "project," "forecast," "intend," "will,"
"expect," "anticipate," "believe," "seek," "target" or other
similar expressions that predict or indicate future events or
trends or that are not statements of historical matters. These
forward-looking statements include, but are not limited to,
statements regarding estimates and forecasts of financial and
performance metrics, projections of market opportunity, total
addressable market (TAM), market share and competition and
potential benefits of the transactions described herein, and
expectations related to the terms and timing of the transactions
described herein. These statements are based on various
assumptions, whether or not identified in this communication, and
on the current expectations of Doma’s and Capitol’s management and
are not predictions of actual performance. These forward-looking
statements are provided for illustrative purposes only and are not
intended to serve as, and must not be relied on by any investor as,
a guarantee, an assurance, a prediction or a definitive statement
of fact or probability. Actual events and circumstances are
difficult or impossible to predict, will differ from assumptions
and are beyond the control of Doma and Capitol.
These forward-looking statements are subject to a number of risks
and uncertainties, including changes in business, market,
financial, political and legal conditions; the inability of the
parties to successfully or timely consummate the transactions
described herein; failure to realize the anticipated benefits of
the transactions described herein; risks relating to the
uncertainty of the projected financial information with respect to
Doma; future global, regional or local economic, political, market
and social conditions, including due to the COVID-19 pandemic; the
development, effects and enforcement of laws and regulations,
including with respect to the title insurance industry; Doma’s
ability to manage its future growth or to develop or acquire
enhancements to its platform; the effects of competition on Doma’s
future business; the outcome of any potential litigation,
government and regulatory proceedings, investigations and
inquiries; and those other factors included in Capitol’s final
prospectus relating to its initial public offering dated December
1, 2020 (File No. 333-249297) and the registration statement on
Form S-4 (File No. 333-254470) filed with the SEC under the heading
"Risk Factors," and other documents Capitol filed, or will file,
with the SEC.
If any of these risks materialize or Doma’s or Capitol’s
assumptions prove incorrect, actual results could differ materially
from the results implied by these forward-looking statements. There
may be additional risks that neither Doma nor Capitol presently
know or that Doma or Capitol currently believe are immaterial that
could also cause actual results to differ from those contained in
the forward-looking statements. In addition, forward-looking
statements reflect Doma’s and Capitol’s expectations, plans or
forecasts of future events and views as of the date of this
communication. Doma and Capitol anticipate that subsequent events
and developments will cause Doma’s and Capitol’s assessments to
change. However, while Doma and Capitol may elect to update these
forward-looking statements at some point in the future, Doma and
Capitol specifically disclaim any obligation to do so, except as
required by law. These forward-looking statements should not be
relied upon as representing Doma’s and Capitol’s assessments as of
any date subsequent to the date of this communication. Accordingly,
undue reliance should not be placed upon the forward-looking
statements.
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