Black Knight To Shed Unit In Bid To Save $13BN Sale To ICE

Mortgage data vendor Black Knight Inc has decided to put its Empower loan origination software business up for sale in an effort to overcome U.S. antitrust concerns over its $13.1 billion proposed acquisition by Intercontinental Exchange Inc, people familiar with the matter said.

Related: ICE To Buy Black Knight For $13.1B

ICE’s takeover of Black Knight would follow its $11 billion purchase of Ellie Mae, another mortgage software company, in 2020.

The Federal Trade Commission (FTC) has been scrutinizing the Black Knight deal for months amid concerns from some U.S. lawmakers that the pricing power ICE would gain in the mortgage data market that lenders rely on could lead to higher costs for consumers.

The uncertainty is reflected in Black Knight’s share price. It has been hovering around $60, a deep discount to the roughly $83 per share current value of the cash-and-stock deal with ICE.

Black Knight has hired Truist Financial Corp to help it explore a sale of Empower and has been soliciting the interest of potential buyers including private equity firms, the sources said. ICE provided its consent to Black Knight going ahead with the move, the sources added.

Empower could be valued at around $400 million, according to one of the sources.

It could not be learned if Black Knight is carrying out the sale process for Empower in co-ordination with the FTC.