Fidelity National to Buy Big Stake in World Tax Service

Fidelity National Financial Inc., continuing its effort to diversify, said Tuesday it has agreed to pay $3 million in cash for 60% ownership of World Tax Service in Brea.

World Tax Service, a subsidiary of privately held WTC Financial of Brea, provides information about property tax payments to mortgage lenders. Under the terms of the deal, expected to close in mid-August, Fidelity will also provide WTC Financial with a $2-million line of credit for working capital to be used by World Tax Service. Also, WTC Financial has an option to buy 100,000 shares of Fidelity common stock at $14.50 per share, slightly higher than the trading price of $13 per share in recent weeks.

Fidelity, an Irvine-based title insurance company, said the acquisition of World Tax Service is part of its strategy to develop businesses closely related to real estate transfer and closing.

In an separate transaction involving another unit of WTC Financial, Fidelity said its subsidiary, American Title Insurance Co., has acquired the operating assets of World Title Co.’s business in Fresno County for $430,000.