BKI - Black Knight/ICE deal spread widens on concern about potential divestiture buyers

The deal spread in Intercontinental Exchange ( NYSE: ICE ) planned purchase of Black Knight ( NYSE: BKI ) widened on concern that potential buyers for the Empower unit that may be divested won't appease U.S. regulator antitrust concerns.

The spread widened to 31% from 29.4% on a report that mortgage technology companies CoreLogic and Sagent have been "blacklisted" from bidding for Black Knight's loan origination Empower unit, according to a CTFN item, which cited industry sources familiar with the matter.

Not allowing strategic buyers CoreLogic and Sagent to make a bid for Empower may mean that BKI/ICE are trying to sell the business to private equity firms, according to the CTFN report.

That strategy could prove problems for Federal Trade Commission regulators that are analyzing the deal, CTFN highlighted.

The latest report comes after Reuters last Thursday reported that Black Knight ( BKI ) was putting Empower up for sale as is tries to gain antitrust approval for its $13 billion sale to ICE. The news comes after a CTFN report last month that bankers have been engaged about possible divestitures as ICE tries to get regulator approval for acquisition.

Analysts and investors have been skeptical if the deal would pass antitrust regulators since the $13 billion planned acquisition of Black Knight was announced in early May. ICE in November said it certified its compliance with the FTC in regards to Black Knight.

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