Intercontinental Exchange, an operator of global exchanges and clearing houses and provider of data and listings services, today announced that it has entered into a definitive agreement to acquire Simplifile. Simplifile operates one of the largest networks connecting the agents and jurisdictions that underpin residential mortgage records, serving as an electronic liaison between lenders, settlement agents, and county recording offices, streamlining the local recording of residential mortgage transactions.
As a pioneer in helping its customers submit electronic documents into the public record, the acquisition of Simplifile expands the ICE Mortgage Services portfolio, which includes MERS. Simplifile and MERS support the residential lending industry’s shift to digitization and will, together, help to make the mortgage closing process simpler, faster, and more transparent for a range of industry stakeholders.
ICE will pay $335 million to acquire Simplifile, which is based in Provo, Utah and has no debt. The transaction is expected to close in the third quarter of this year, subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. ICE does not expect the transaction to have any impact on its previously announced capital return plans. Upon closing, Simplifile, which has approximately 200 employees, will continue to be based in Provo and operate under the Simplifile name.
“Originators, consumers, and investors can obtain significant benefits and savings as the real estate process shifts from paper-based to digital transactions. Simplifile understood this trend early, uniquely solving for the critical aspect of submitting required documents into the public record in a seamless, auditable and transparent method,” said Chris McEntee, President of ICE Mortgage Services. “By connecting lenders, settlement agents, and counties through a robust network, Simplifile will enhance ICE’s efforts to further streamline a legacy process ripe for innovation,” McEntee added.
Simplifile was founded in 2000 with the goal of digitizing the closing process of the real estate industry. Starting with Utah County, it began the process of onboarding, one by one, all 3,594 mortgage recording jurisdictions in the U.S. Simplifile today connects 1,922 counties in the United States, representing over 80 percent of the U.S. population. Leveraging its core eRecording product, Simplifile continues to introduce additional electronic solutions to serve the entire real estate transaction supply chain. The company has delivered a consistent history of revenue growth and has been profitable every year since its founding.
“We’ve seen how ICE has helped to transform markets going through an analog to digital conversion and has made them more transparent and efficient for all participants,” said Paul Clifford, Founder and President of Simplifile. “We are closely aligned with ICE’s vision as it applies to the residential mortgage industry and, as we become part of Intercontinental Exchange, our team at Simplifile will continue our efforts to simplify the industry for all of its stakeholders,” Clifford added.
As an indication of the increased pace of transformation of the mortgage industry, ICE and MERS announced earlier in April that the number of eNotes added to the MERS eRegistry during the first quarter of 2019 exceeded the total number of eNotes registered for all of 2018. An electronic note, or eNote, is the functional equivalent of a paper promissory note when created in conformity with eCommerce law requirements, and upon origination, is registered on the MERS eRegistry. Digital solutions such as the eNote are gaining traction and represent an important step towards a fully electronic mortgage.