First American Corp. Agrees to Acquire Maryland Firm

First American Corp. said Tuesday it agreed to acquire Credit Management Solutions Inc. for about $52 million in a stock swap, broadening its centralized national database that streamlines title searches.

The move, approved by the boards of both companies, is expected to close in the second quarter, said First American, a Santa Ana title company that offers real-estate-related financial and informational services.

Shareholders of Credit Management, based in Annapolis Junction, Md., would receive no more than 0.2841 and no less than 0.2083 of a First American share of common stock for each share of Credit Management common stock.

The agreement represents a premium of up to 2 1/2 times Credit Management’s closing stock price of $3.75 a share on Monday.

Credit Management’s shares on Tuesday moved up nearly 72%, or $2.69, in Nasdaq trading. First American’s shares dipped $1.21 to $30.79 on the New York Stock Exchange.

First American expects to retain substantially all of Credit Management’s 200 employees, the Santa Clara-based company said.

While the merger must be approved by the holders of a majority of Credit Management’s shares, holders of about 49% of these have already entered into a voting agreement in support of the merger, First American said.