February 6, 2020 / 8:52 PM / 21 days ago

Exclusive: Fidelity National nears deal to acquire FGL Holdings - sources

(Reuters) - Fidelity National Financial Inc (FNF.N) is nearing a deal to acquire U.S. annuities and life insurance firm FGL Holdings Inc (FG.N), as it seeks to expand beyond its core title insurance business, three people familiar with the matter said on Thursday.

If the negotiations are concluded successfully, a deal for FGL, which has a market value of $2.7 billion, could be announced in the next few days, the sources said, cautioning that an agreement is not certain. The exact price being negotiated could not be learned.

The sources asked not to be identified because the matter is confidential. FGL and Fidelity National Financial did not immediately respond to requests for comment.

FGL shares ended trading up 19.4% at $12.15 following the news on Thursday. Fidelity National shares closed nearly flat at $49.04, giving the company a market capitalization of around $13.6 billion.

Based in Des Moines, Iowa, FGL is a provider of annuity and life insurance products. It generated $1.55 billion in revenue in the first nine months of 2019, up 68% year on year.

FGL was acquired in 2017 in a $1.84 billion deal by an investor group led by a so-called special purpose acquisition company founded by veteran dealmaker Chinh Chu, as well as funds affiliated with private equity firm Blackstone Group Inc (BX.N) and Fidelity National Financial.

Fidelity National Financial had a 7.6% stake in FGL as of the end of September. Blackstone is expected to keep a stake in the combined company, two of the sources said. Blackstone will continue to invest FGL’s assets on the combined company’s behalf, one of the sources added.

Based in Jacksonville, Florida, Fidelity National Financial provides title insurance and transaction services to the real estate and mortgage industries. It reported revenue of $6.1 billion in the first nine months of 2019, up 3.5% on the prior year period.

Reporting by Joshua Franklin and David French in New York; Editing by Tom Brown and Matthew Lewis

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