Fidelity National to Spin Off Division

Assets of the lender processing services will go to form a new subsidiary called Newco in exchange for all of Newco's common stock and about $1.6 billion of Newco debt securities.

Once the exchange is completed, with SEC approvals and an IRS ruling for a tax-free spinoff, Fidelity National will distribute the common stock of Newco to its shareholders.

"We believe the proposed separation will provide more company flexibility and dedicated management focus with respect to product development, capital investment and strategic initiatives, which should ultimately drive higher value to our customers and shareholders," William Foley, executive chairman of Fidelity National said in a statement.

Fidelity National's lender processing service unit provides large mortgage lenders with origination, automated title and settlement, processing, default, valuation, risk management tax, flood and collateral protection solutions. The division generated $1.7 billion in revenue during the past 12 months.

Fidelity hopes the planned spinoff can happen by the middle of 2008.