The company founded by NBA legend Earvin “Magic” Johnson has bought a controlling stake in EquiTrust Life Insurance Co., creating the nation’s largest black-owned insurance company.
Magic Johnson Enterprises said it bought more than a 60 percent interest in Chicago-based EquiTrust from Guggenheim Partners LLC, but didn’t disclose a purchase price.
New York-based Guggenheim, which will no longer have a stake in EquiTrust, bought the insurer in 2011 for $440 million from FBL Financial Group Inc., according to Bloomberg.
Guggenheim Partners will continue to provide investment management services for EquiTrust.
EquiTrust manages $14.5 billion in fixed-rate and indexed annuities and life insurance through a national network of more than 23,800 independent agents.
Magic Johnson Enterprises, which focuses its investments on underserved urban communities, said the acquisition of EquiTrust diversifies its portfolio holdings to include a nationwide provider of retail financial services.
“The EquiTrust acquisition is significant in that there is limited ownership by minorities among financial institutions today,” the company said, adding that the deal is the largest purchase of a financial services company by an individual African American entrepreneur or group of African American entrepreneurs.
“EquiTrust provides MJE a tremendous platform to advocate for financial literacy and assist in creating job opportunities at every level. We will educate and emphasize the importance of life insurance for estate planning and annuities for retirement planning purposes,” said Johnson, who also serves as MJE’s CEO and chairman. “It’s not only groundbreaking, but continues my mission to invest in businesses where we can make a positive impact in the community.”
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