LandAmerica Plans $251M Buyout of Capital Title

SCOTTSDALE, AZ-LandAmerica Financial Group Inc. is headed West with a $251-million take-over deal of Capital Title Group Inc., a locally based underwriter, agent and settlement services provider. The acquisition has yet to be approved by regulatory agencies and Capital Title's shareholders.

Upon approval of the deal, anticipated to take three to five months, the Richmond, VA-based LandAmerica will acquire 100% of Capital Title's common stock for $251 million, 80% of which will be cash and 20% will be LandAmerica common stock. Capital Title, which opened its doors in 1981 in Scottsdale, will hold onto its name despite the ownership change.

LandAmerica's acquisition involves people, knowledge, goodwill and equipment rather than hard real estate. "Except for the headquarters facility in our home location, we don't have a lot of hard real estate assets," says Rudy R. Miller, chairman, president and CEO of the Miller Group, investment relations counsel, in Phoenix. The Miller Group helped to negotiate the transaction on behalf of Capital Title.

Miller tells GlobeSt.com that Capital Title is 10 years into a 100-year lease at the 35,000-sf headquarters building at 2901 E. Camelback Rd. Though the lease consideration could not be obtained, experts say Camelback leases are valued at $16 per sf, on average.

Meanwhile over the years, Capital Title has acquired its share of smaller companies. "They have about 140 smaller offices, operating under different names, in Arizona, California and Nevada," Miller says. "They average between 3,000 to 6,000 sf in size, depending on the type of operation."

Miller adds LandAmerica isn't the first to knock on Capital Title's door as a potential acquisitions suitor, but in terms of synergy and specialties, the corporate cultures match well. "Our main focus, our bread and butter, has been mainly in resale of existing homes and insurance," he says. "We don't do much home builder or commercial title work, LandAmerica does more of that."

The geographic territories also provide a good complement for the two companies. "LandAmerica is strong in the East, Southeast and Midwest," Miller says. "They're not as strong in the West, where we are."