Fidelity National Financial (FNF) has signed an agreement to acquire US-based title insurance company Stewart Information Services in a cash and equity deal valued at about $1.2bn.

Stewart provides residential and commercial title insurance, closing and settlement services, appraisal and valuation services, among other offerings to the real estate industry.

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Under the terms of the deal, the consideration will be paid 50% in cash and 50% in Fidelity common stock. Stewart stockholders will also have the option to choose to receive their consideration in all cash or all stock.

Fidelity in its press statement said that it expects to achieve at least $135m in “operational cost synergies” from the acquisition.

Fidelity plans to fund the transaction through a combination of cash on hand, debt financing and the issuance of its common stock to Stewart stockholders.

Fidelity National Financial chairman William Foley II said: “The venerable Stewart brand has a long and respected history in the title insurance industry and we see tremendous potential in working with the Stewart management team to invest in and grow the Stewart brand on a national basis as part of our long-time, successful strategy of operating multiple title insurance brands under the FNF umbrella.”

Fidelity CEO Raymond Quirk said: “We are very familiar with Stewart in the marketplace and see multiple areas where we can assist and accelerate Stewart’s growth plans.

“We also believe there are significant operational efficiencies we can bring to bear by leveraging FNF’s shared services infrastructure that will provide meaningful long-term value creation opportunities for our shareholders.”

The transaction is scheduled to be completed during the first or second quarter of 2019, subject to regulatory approvals and other customary closing conditions.