CDB Infotek Sells 70% of Company to Equifax Insurance

By JOHN O’DELL

Sept. 5, 1996 12 AM PT

TIMES STAFF WRITER

SANTA ANA —

CDB Infotek, a fast-growing Santa Ana-based public data firm used by lawyers, police, researchers and insurance and government agencies, has sold a 70% stake to a subsidiary of Atlanta-based information giant Equifax Inc.

CDB, which has 200 employees, will retain its name, management and Orange County headquarters, and is expected to use the funding provided by Equifax Insurance Services to finance future growth. The company said no layoffs are anticipated.

Like other information gathering and dissemination businesses, CDB is developing avenues to make its products--which include court, real estate and personal data from across the nation--available to the general public. The company is counting on funding from Equifax to help speed that process.

People who are buying products and services from a business “should be able to look at the same deck of cards the business looks at” when it checks its customers for credit, a CDB spokesman said.

Terms of the sale were not disclosed, but an Equifax spokesman said the company paid more than $32 million--CDB’s 1995 revenue--for the 70% share.

The deal “makes a lot of sense” for both companies, said Robert V. Bolen, an information industry analyst with the J.C. Bradford & Co. investment bank in Nashville. “Everyone in the industry is looking for that niche that gives them something more to offer and some room to grow.”

Indeed, the two Boston investment firms that earlier this year agreed to acquire Orange-based TRW Information Systems & Services for $1.1 billion from its conglomerate parent, TRW Inc., say they intend to use the company as a vehicle for acquiring more information and data services firms. TRW Information is a major competitor of Equifax.

Rick Rozer, a former private investigator who started CDB as an insurance investigations business in 1978, said CDB needed a deep-pocketed financial partner to help the company grow. As part of the deal, Equifax Insurance acquired the 35% stake that media giant Viacom Inc. had purchased in CDB in January 1995.

“We thought Viacom would be that partner,” said Rozer, who will continue as CDB’s president and chief executive. “But they were interested in consumer products and we just couldn’t translate what we do to the consumer market quickly enough to make it work.’

Equifax wanted CDB Infotek because of its huge database of public records, said Equifax spokesman Norman Black.

“One reason CDB holds the position it holds today as one of the major public information sources is their archive of information that is available online,” Black said. “Many government jurisdictions in the U.S. today only keep information on file and easily accessible for about six months. . . . CDB puts it into a database that keeps it alive a lot longer, maybe five years, and that is an incredible resource.”

CDB Infotek has grown substantially in recent years. It has made several acquisitions since 1995, including Prentice Hall On-Line, Charles E. Simon & Co. and Innovative Data Services.

Equifax Insurance Services Group is the largest provider of risk management information to the insurance industry in the United States. Its parent, Equifax Inc., is a major provider of information services and recorded $1.7 billion in sales last year.

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New Owner

Equifax Insurance Services, a subsidiary of Equifax Inc. has taken a 70% stake in Santa Ana-based CDB Infotek. A look at the two companies involved in the deal:

Equifaxc Insurance Services

* Headquarters: Atlanta

* Parent company: Equifax Inc.

* Business: Provides risk- management information to insurance firms.

* Top executive: Derek Smith, executive vice president.

* Founded: 1900 (Equifax founded in 1899).

* Employees: 6,800

* 1995 revenue: $517 million (Equifax, $1.6 billion)

CDB Infotek

* Headquaters: Santa Ana

* Business: Public records information

* Founder and CEO: Rick L. Rozar