Government Lending

Investors threaten to replace CoreLogic board in response to takeover bid rejection

Cannae Holdings and Senator Investment Group claim they have received widespread support from shareholders

This morning, we reported that property data and analytics company CoreLogic Inc. had rejected an unsolicited $7 billion takeover bid from two of its major investors, Cannae Holdings and Senator Investment Group

On June 26, Cannae and Senator — who jointly own or have an economic interest equivalent to approximately 15% of CoreLogic’s outstanding common stock —  offered to buy CoreLogic for $65 per share in cash. In a statement, CoreLogic Chairman Paul Folino described the bid as an “opportunistic proposal.”

Cannae and Senator did not take too kindly to CoreLogic’s rejection, issuing a statement of their own, claiming that the company had rejected their proposal “without any sign of seriously considering it.”

The firms also alleged that CoreLogic had refused to engage with them regarding the bid, and that it was “now adopting a poison pill while summarily rejecting” its proposal “with the typical smokescreen of regulatory concerns and overly optimistic multi-year projections.”

Further, Cannae and Senator questioned CoreLogic’s alleged hiring of defensive advisory firms weeks ago despite public statements that it had no knowledge of the firms’ takeover interest. It also questioned the company’s “raising guidance in a highly irregular evening announcement five days before the end of the quarter.”

“Notably this is the same company that for ten years enjoyed ironclad protection from acquisition offers due to a purchase right that only expired June 1st,” they said in a written statement.

The firms claim they have received widespread support from shareholders. They also went on to issue an ultimatum to CoreLogic’s board: if the company “continues with its current course of action,” Cannae and Senator plan to call a special meeting to replace the board as early as July 28.

They also called CoreLogic’s newly issued multi-year guidance and “unsubstantiated” references to “regulatory” concerns with its proposal “nothing more than misdirection.”

“After years of poor organic growth, today’s multi-year forecast implies wildly optimistic assumptions including mortgage originations well above consensus industry projections,” the firms wrote. “As for ‘regulatory’ concerns and ‘business overlaps,’ we thoroughly reviewed all potential regulatory and antitrust matters prior to making our proposal and determined that there are no material hurdles to our consummating a transaction.”

The investors said they were committed to signing an acquisition agreement with a ‘hell or high water’ provision.

“Had the board responded to our requests for a discussion, they would know that,” they said.

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