Related to its goal of achieving profitability, title insurer Doma announced Thursday that it had sold its title operations in Texas, Minnesota, Wisconsin, Illinois and Indiana to two different companies.
The financial terms of the deals were not disclosed.
“These strategic transactions are aligned with our mission-driven go-forward strategy and refined focus on our core underwriting and technology business,” Max Simkoff, the founder and CEO of Doma, said in a statement. “Our Texas and Midwest operations have a track record of providing excellent customer service. We believe we have found optimal homes for our Local team members in the branches we have sold. I want to thank these teams for their hard work and dedication to Doma and our vision over the years.”
Chicago-based title firm Near North Title Group acquired Doma’s 30 offices in the Midwest. Through the deal Near North will add 100 industry professionals onto its team, and it now has nearly 60 offices in six Midwest states and Florida.
“Our mission at Near North Title Group is to partner with our clients and protect their interests throughout the real estate transaction process,” Dan Fowler, the CEO of Near North Title Group, said in a statement. “This acquisition represents a tremendous opportunity for us to extend our reach and enhance our ability to serve clients across the Midwest. We are excited to welcome the talented team from Doma.”
In addition, Alex Grundhoffer, Doma’s national chief operating officer of local branch operations and Doma’s managing director of Minnesota, Wisconsin, Illinois and Indiana title operations, is joining Near North.
“The synergies of our collective management team and office locations made Near North the perfect home for our valued employees and clients,” Grundhoffer said in a statement. “Near North’s culture and industry knowledge, especially so given the strong national commercial capabilities, will bring value to our local teams and communities. My team looks forward to being a part of the Near North family.”
Capital Title of Texas LLC., a member of The Shaddok Title Companies, purchased Doma’s operations in Texas.
“We are thrilled to welcome the talented team from Doma to the Capital Title Family,” Bill Shaddock, the CEO of The Shaddock Title Companies, said in a statement. “Their expertise and deep understanding of the Texas market will be invaluable as we continue to expand our operations and deliver exceptional title and escrow services to our customers. This acquisition strengthens our position as a leading title company in Texas.”
In May, In May, Williston Financial Group acquired 22 of Doma’s retail title locations and operations centers in Northern and Central California.
During Q1, Doma recorded a 33.7% year-over-year decrease in revenue to $74 million, however its net loss did improve to $42.1 million, compared to $50.0 million in Q1 2022. The firm’s adjusted EBITDA loss also improved to $21.59 million from $44.90 million a year prior.
This improvement came even as the number of title orders opened in the quarter dropped 72% year over year to 9,940.
“Despite persistent macro pressures, we do feel adjusted EBITDA profitability is still attainable by the end of 2023. That being said, we remain cautiously optimistic regarding this time line as we understand the importance of preserving the ability for our new transformative strategy to take shape,” Simkoff told investors and analysts during Doma’s Q1 earnings call. “Given our revised plans and that we believe our market share is less than 2% of the overall title insurance market today, we foresee a long runway of opportunity ahead of us to grow our business.”
