Title Insurer Safeco Agrees to Be Acquired

Safeco Title Insurance, a Panorama City concern that ranks among the nation’s top 10 title insurers, has agreed to be acquired by Chicago Title & Trust for $85 million.

The purchase will give the Chicago company overall title insurance assets of $419 million, rivaling Los Angeles-based Ticor Title Insurers as the largest in the field. The deal is expected to close around year-end, assuming it gains clearance from state and federal regulators.

Publicly held Safeco Corp. of Seattle said it is selling its title insurance operation to concentrate on property and casualty insurance. Chicago Title & Trust, which will pay $34 million in cash and the rest in notes, said the acquisition will speed its growth in the West.

Chicago Title Insurance, the title insurance unit of Chicago Title & Trust, already ranks second in the business, behind Ticor, by several measures. As of June 30, Chicago Title Insurance had assets of $272 million, while Safeco Title’s assets were $147 million.

Stand Undecided

Ticor officials said they hadn’t decided whether to oppose the deal on antitrust grounds.

Safeco Title, with about 530 employees, earned $1.2 million on revenue of $74.0 million in the first six months of 1986, versus earnings of $1.4 million on revenue of $66.5 million during the same period of 1985. David Vargo, an analyst with the investment firm of Duff & Phelps, said the company has rebounded nicely from a pretax loss of $15.8 million in 1984, and that further gains are expected because Safeco Title is conservative in booking income.

Chicago Title Insurance, a unit of publicly held Alleghany Corp. of New York, earned $12.2 million on revenue of $172.4 million in the first half of this year. Comparable 1985 figures weren’t available.

Chicago Title & Trust said it plans no layoffs for Safeco Title and will run it as a separate unit.