Fidelity National Financial (FNF) announced that its F&G business has acquired a 30% ownership stake in its long-standing partner and top Life Insurance Marketing Organization (IMO) company, Freedom Equity Group (FEG).
The financial terms of the deal have been kept under wraps. Shares of FNF, a provider of title insurance and settlement services to the real estate and mortgage companies, have gained 38% over the past year. (See Fidelity National Financial stock charts on TipRanks)
FEG provides individuals with an opportunity to become business owners by selling life insurance products, allowing greater control over their careers, income, and time.
The deal will enhance F&G’s distribution capabilities to fuel growth in middle-market indexed universal life (IUL) sales and strengthen its presence in underserved markets.
The deal is in line with F&G’s diversification strategy as it continues to expand its life business footprint with higher penetration across multi-cultural segments in the U.S. Over the past year, F&G successfully launched in the bank and broker-dealer channels and institutional markets.
John Phelps, EVP and Chief Distribution Officer at F&G commented, “This partnership will help address the risk and retirement needs of a vastly underserved market reaching more communities while creating additional opportunities for individuals to build their own businesses as agents.”
Barclays analyst Mark Devries increased the price target on Fidelity National from $58 to $63 (34.6% upside potential) and reiterated a Buy rating on the stock.
Overall, the stock has a Moderate Buy consensus rating based on 2 unanimous Buys. The average Fidelity National Financial price target of $60.50 implies 29.3% upside potential from current levels.
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