LandAmerica Signs Stock Purchase Agreement for Underwriters
November 26 2008 - 1:43AM
PR Newswire (US)
LandAmerica and 1031 Subsidiary File for Bankruptcy Protection
RICHMOND, Va., Nov. 26 /PRNewswire-FirstCall/ -- LandAmerica
Financial Group, Inc. (NYSE:LFG) announces the signing of a
definitive Stock Purchase Agreement for the sale of the Company's
two principal title underwriting subsidiaries, Lawyers Title
Insurance Corporation ("Lawyers Title") and Commonwealth Land Title
Insurance Company ("Commonwealth"), as well as United Capital Title
Insurance Company ("United") to Fidelity National Title Insurance
Company ("Fidelity") and Chicago Title Insurance Company
("Chicago"). In order to facilitate the closing of the transactions
under the Stock Purchase Agreement and protect the Company's
remaining assets following the recent announcement of the
termination of its 1031 exchange business, the Company and its
subsidiary LandAmerica 1031 Exchange Services, Inc. ("1031 Exchange
Company") have filed voluntary petitions for relief under Chapter
11 of the United States Bankruptcy Code in the United States
Bankruptcy Court for the Eastern District of Virginia ("Bankruptcy
Court") in Richmond, Virginia. In conjunction with the filings, the
Company is seeking a motion for expedited approval of the
transactions contemplated by the Stock Purchase Agreement. None of
the other many businesses of LandAmerica are seeking bankruptcy
protection. On Monday, November 24, 2008, the Nebraska Department
of Insurance filed petitions for rehabilitation for Commonwealth
and Lawyers Title under the Nebraska Insurance Code. Hearings on
the petitions are set for later today. The Company expects that
rehabilitation orders will be entered quickly and that the
rehabilitations will function as a temporary administrative step to
assist the transition of Lawyers Title's and Commonwealth's
businesses to the family of companies owned by Fidelity National
Financial, Inc. ("FNF"). Lawyers Title and Commonwealth will
continue to operate and serve customers during the completion of
the sale. Both underwriters are entirely solvent. Under the Stock
Purchase Agreement, Fidelity and Chicago Title will pay the Company
$298 million in total for Commonwealth, Lawyers Title and United.
The closing of the transactions under the Stock Purchase Agreement
are subject to approvals by the Bankruptcy Court, the Nebraska
Department of Insurance, and other state and federal regulatory
agencies. The Company intends to work with FNF toward a closing as
early as late December 2008 and will request expedited approval
from the Bankruptcy Court. In conjunction with the bankruptcy
filing, LandAmerica is seeking customary authority from the
Bankruptcy Court that will enable it to continue operating its
business and serving its customers in the ordinary course. The
Company will make similar requests of the Nebraska Department of
Insurance in connection with the rehabilitation process.
LandAmerica's recent announcements of the termination of the merger
agreement with FNF and the discontinuation of the 1031 Exchange
Company's business caused the Company to accelerate these actions.
The Company believes that the coordinated stock purchase, Chapter
11 petition and insurance rehabilitation process are in the best
interests of its stakeholders. The Company also expects that the
supervision of Commonwealth and Lawyers Title during rehabilitation
and the transition to the FNF family of companies will provide
employees and customers with necessary protection and assurances in
conducting real estate transactions. Following the consummation of
the stock purchase and under the protection of Chapter 11, the
Company plans to continue its assessment of strategic opportunities
for its remaining businesses. According to Theodore L. Chandler,
Jr., Chairman and Chief Executive Officer, "I am deeply
disappointed over the need to file for bankruptcy protection for
the LandAmerica holding company and the 1031 company. However, this
sale of our principal domestic title operations to Fidelity
National in this coordinated Chapter 11 filing and Nebraska
rehabilitation action offers our stakeholders the best result
available in this brutal real estate, credit and capital market
environment." About LandAmerica Financial Group, Inc. 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 its 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 Fortune's(R) 2007 and 2008 lists of America's Most
Admired Companies. The Company cautions readers that the statements
contained herein regarding the Company's future financial
condition, results of operations, future business plans,
operations, opportunities or prospects, including any factors which
may affect future earnings, are forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are
based upon management's current knowledge and assumptions about
future events and involve risks and uncertainties that could cause
actual results, performance or achievements to be materially
different from any anticipated results, performance or
achievements, expressed or implied by such forward-looking
statements. Such risks and uncertainties include: -- the Company's
results of operations and financial condition are susceptible to
changes in mortgage interest rates, the availability of mortgage
financing and general economic conditions; -- changes to the
participants in the secondary mortgage market could affect the
demand for title insurance products; -- the Company is subject to
government regulation; -- heightened regulatory scrutiny of the
Company and the title insurance industry, including any future
resulting reductions in the pricing of title insurance products and
services, could materially and adversely affect the Company's
business, operating results and financial condition; -- adverse
market conditions may significantly affect the Company's ability to
meet its liquidity needs; -- adverse changes in general business or
economic conditions generally or specifically in the principal
markets in which the Company does business could adversely impact
the Company's business; -- the Company may not be able to fuel its
growth through acquisitions; -- the Company's inability to
integrate and manage successfully its acquired businesses could
adversely affect its business, operating results and financial
condition; -- regulatory non-compliance, fraud or defalcations by
the Company's title insurance agents or employees could adversely
affect its business, operating results and financial condition; --
competition in the Company's industry affects its revenue; --
significant industry changes and new product and service
introductions require timely and cost-effective responses; -- the
Company's litigation risks include substantial claims by large
classes of claimants; -- the Company's claims experience may
require it to increase its provision for title losses or to record
additional reserves, either of which may adversely affect its
earnings; -- key accounting and essential product delivery systems
are concentrated in a few locations; -- provisions of the Company's
articles of incorporation and bylaws and applicable state
corporation, insurance and banking laws could limit another party's
ability to acquire the Company and could deprive shareholders of
the opportunity to obtain a takeover premium for shares of common
stock owned by them; -- the Company's future success depends on its
ability to continue to attract and retain qualified employees; --
the Company's conduct of business in foreign markets creates
financial and operational risks and uncertainties that may
materially and adversely affect its business, operating results and
financial condition; and -- various external factors including
general market conditions, governmental actions, economic reports
and shareholder activism may affect the trading volatility and
price of the Company's common stock. For a description of factors
that may cause actual results to differ materially from such
forward-looking statements, see the Company's Annual Report on Form
10-K for the full year 2007 and other reports from time to time
filed with or furnished to the Securities and Exchange Commission.
The Company cautions investors not to place undue reliance on any
forward-looking statements as these statements speak only as of the
date when made. The Company undertakes no obligation to update any
forward-looking statements made in this release. DATASOURCE:
LandAmerica Financial Group, Inc. CONTACT: G. William Evans, EVP -
Chief Financial Officer, +1-804-267-8114, , or Lloyd Osgood, SVP -
Corporate Communications, +1-804-267-8133, Web site:
http://www.landam.com/
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