An LLC controlled by LeBron James borrowed nearly $300 million from two Midwestern life insurers advised by an arm of Guggenheim Partners months before he signed with the Los Angeles Lakers in 2018, according to insurance industry records reviewed by Bloomberg.
The previously unreported bonds are structured against future revenue from James’ endorsement deals, including his lifetime Nike sponsorship, and are not due until 2049.
The arrangement began while James was still with the Cleveland Cavaliers, ahead of his 2018 free-agency decision to join the Lakers. North American Company for Life and Health Insurance and Midland National Life Insurance Co., both owned by Sammons Financial Group, purchased the initial bonds issued by James’ LLC, King James Funding, carrying a 4.8% interest rate.
The two insurers held approximately $245 million in bonds tied to James’ LLC by the end of last year, after some debt was paid down and additional bonds were issued.
In 2022, the same insurers provided roughly $60 million in additional financing around the time James signed a $97 million contract extension with the Lakers.
A spokesperson for James described the arrangement as a standard financial structure for high-earning individuals.
“Transactions were a securitization done by Mr. James with his personal, non-NBA salary, assets and income which is a very common financial structure for an individual with this level of earnings and assets.”
The spokesperson also said the 2022 transaction received a third-party credit rating and full NBA approval.
The Guggenheim connection
Guggenheim, led by Mark Walter, also appeared as an investor in James and Maverick Carter’s media venture, SpringHill Co., in 2020.
The financing arrangement adds context to Walter’s broader use of insurance company assets to fund sports and private investments.
Walter’s insurers face ongoing scrutiny from the Justice Department and Securities and Exchange Commission over more than $20 billion in loans tied to affiliated businesses that were reportedly not properly disclosed.
Sammons Financial Group indicated during a recent investor call that it has been reducing its financial ties to Guggenheim.
Walter’s sale of the Lakers comes as he continues restructuring his business empire amid the federal investigation.
James left the Lakers to sign with the Philadelphia 76ers this offseason.
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