Guggenheim-led Investors Indirectly Contribute $175 Million of Capital into Security Benefit Life Insurance Company

CHICAGO & TOPEKA, Kan.--(BUSINESS WIRE)-- The group of investors led by Guggenheim Partners, LLC that agreed on February 15^th to acquire Security Benefit Corporation (SBC) today indirectly contributed $175 million of capital into Security Benefit Life Insurance Company (SBL), SBC’s primary life insurance company subsidiary. The contribution was structured as a loan to SBC, the proceeds of which were contributed by SBC to SBL pursuant to the acquisition agreement.

“We are pleased that major credit rating agencies already have changed their outlooks for SBL and First Security Benefit Life Insurance and Annuity Co. of New York to positive, and we remain focused on following through on our plans to return to investment grade,” said Howard R. Fricke, interim Security Benefit chairman of the board, president and chief executive officer.

Fricke also said that he is pleased with the positive reception the acquisition is receiving from Security Benefit’s distribution partners, including the NEA’s Member Benefits Corporation.

“We at NEA’s Member Benefits are pleased with the acquisition of Security Benefit by an investment group led by Guggenheim Partners,” said Gary Phoebus, NEA’s Member Benefits Corporation president and chief executive officer. “We believe it will help to reposition Security Benefit as a more stable company that NEA members can count on for quality investment and retirement services. Security Benefit has always exhibited a commitment to our members. It is our anticipation that this development will enhance that commitment and our partnership for years to come.”

One of Security Benefit’s key business partners, FHLBank Topeka, also indicated their support of the transaction. "We view this transaction as a very positive development," said Andy Jetter, FHLBank Topeka president and chief executive officer. "We do quite a bit of business with Security Benefit. I think this transaction will be a big boost for Security Benefit and Topeka."

It is anticipated the remainder of the $400 million investment to be made by the Guggenheim-led investor group will be made at the closing of the transaction, which is expected late second quarter or early third quarter 2010 following regulatory, policyholder and fund shareholder approval.

About Guggenheim Partners

Guggenheim Partners, LLC is a diversified financial services firm with more than $100 billion in assets under supervision. The firm’s businesses include investment management, investment advisory, insurance, investment banking and capital markets services. The firm is headquartered in Chicago and New York with a global network of offices throughout the United States, Europe and Asia. For more information, please visit www.guggenheimpartners.com.

About Security Benefit

Security Benefit fosters strong partnerships to provide insightful and customized retirement solutions for employers and individual investors nationwide. Through a broad advisor network and its nationally recognized money managers, Security Benefit provides mutual funds, annuities, exchange traded funds, broad retirement plans and programs. As an industry leader in service technology, Security Benefit affiliates also offer business processing and broker/dealer solutions tailored to the financial services marketplace. For more information about us, visit www.securitybenefit.com.

This press release includes "forward-looking statements." Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "contemplate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. Forward-looking statements in this press release include, without limitation, forecasts of market growth, future revenue, benefits of the proposed acquisition, expectations that the acquisition will successfully be consummated, and other matters that involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to differ materially from results expressed or implied by this press release. Such risk factors include, among others: uncertainties as to the timing of the acquisition; the satisfaction of other closing conditions to the transaction; the ability to attract and retain clients and employees; whether certain market segments grow as anticipated; the competitive environment in the financial services industry and competitive responses to the proposed acquisition; and whether the companies can successfully develop new products and the degree to which these gain market acceptance. Actual results may differ materially from those contained in the forward-looking statements in this press release. Security Benefit and Guggenheim undertake no obligation and do not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement.

Services are offered through and securities are distributed by Security Distributors, Inc.
Annuities are issued by Security Benefit Life Insurance Company in all states except New York. In New York, annuities are issued by First Security Benefit Life Insurance and Annuity Company of New York, Rye Brook, NY.

Guggenheim Partners
Jeffrey Kelley, 312-977-4029
[email protected]
or
Security Benefit Corporation
Michel’ Cole, 785-438-3396
[email protected]

Source: Guggenheim Partners, LLC