First American Financial Corp. in Santa Ana will acquire Midland Title Security Inc. in Cleveland as a wholly owned subsidiary under a definitive agreement between the boards of both companies, the firms said Wednesday.
Under the agreement, participating Midland Title shareholders will receive 5.14 First American common shares for each Midland Title common share. Up to 220,671 First American shares will be issued assuming all Midland Title shareholders participate. First American currently has 2,544,687 common shares outstanding.
If Midland Title achieves certain 1986 after-tax earnings, its shareholders have the right to receive additional First American shares amounting to 10% of the shares initially issued.
The transaction is subject to the approval of Midland Title's shareholders.
First American Financial's principal subsidiary, First American Title Insurance Co., operates nationwide and in Guam, Puerto Rico and England. Midland Title is the largest title agent in Ohio and owns a title agency subsidiary in Pittsburgh.