In what marks its third significant acquisition in the property valuation and appraisal space in the last six months, CoreLogic announced Tuesday that it plans to acquire total ownership of RELS, LLC, a provider of property valuation and appraisal services, from Wells Fargo.
Prior to the acquisition, RELS operated under the joint ownership of CoreLogic and Wells Fargo, with CoreLogic previously owning 50.1% of the company and Well Fargo owning the remaining 49.9%.
Under the terms of the agreement, CoreLogic will pay $65 million to Wells Fargo for its ownership interest in RELS.
"RELS has been a leading provider of property valuation services for almost two decades under the joint ownership of CoreLogic and Wells Fargo,” said Anand Nallathambi, President and Chief Executive Officer of CoreLogic. “Consolidating our ownership of RELS represents a logical next step in expanding the capabilities and scale of our property valuations offerings.”
CoreLogic has been expanding its footprint in property valuation for the last six months.
Last year, CoreLogic purchased LandSafe Appraisal Services, an appraisal management company, from Bank of America for $122 million.
And late in 2015, CoreLogic announced plans to acquire FNC, Inc., a provider of real estate collateral information technology and solutions that automate property appraisal ordering, tracking, documentation and review for lender compliance with government regulations, for $475 million.
When CoreLogic announced the acquisition of FNC, Nallathambi said that along with the acquisition of LandSafe, the deal for FNC signaled that the company views property valuation as a “significant” area of growth in the future.
CoreLogic’s chief operating and financial officer, Frank Martell, said that the acquisition of the remaining interest in RELS is another step in that plan.
“RELS's market leadership and proven operational excellence; together with our existing valuation-related assets and our recent acquisition of LandSafe Appraisal Services and the pending acquisition of FNC, allow us to bring unique insights and compelling solutions to the marketplace which should generate significant topline growth opportunities for CoreLogic in 2016 and beyond,” Martell said.
According to a release from CoreLogic, RELS is a nation-wide provider of real estate asset valuation and appraisal solutions. CoreLogic said that RELS offers its clients access to high quality and experienced valuation professionals; electronic property appraisal ordering, tracking and fulfillment services and workflow best practices.
CoreLogic said that the acquisition of RELS adds scale and the combined company creates “integrated property valuation solution provider powered by a broad suite of fulfillment, data and analytics capabilities and assets.”
According to CoreLogic, RELS's operating results will be fully consolidated into the company’s financial reporting beginning in the first quarter of 2016.
Previously, RELS operating results were reflected in the CoreLogic’s financial reporting, reflective of its ownership share.
CoreLogic said that the transaction is expected to be accretive to 2016 financial results excluding one-time integration investments and reductions from transitional accounting items.
CoreLogic also said that the transaction was funded using cash on hand.
Wells Fargo said that while its relationship with RELS is ending, its relationship with CoreLogic will continue.
"CoreLogic, through its management of the RELS AMC operations, has consistently demonstrated its value as a service provider with a strong commitment to quality products and services," said Franklin Codel, executive vice president, Wells Fargo Home Lending.
"Our teams will continue to work well together and we expect CoreLogic to remain a valued service provider and an important part of Wells Fargo's valuation vendor management strategy,” Codel added. “The sale is not material to Wells Fargo and represents the end of Wells Fargo's ownership interest in RELS, LLC."