Since stearic acid is a weak organic acid, it cannot directly react with magnesium sulfate to produce magnesium stearate.

In the commercial manufacturing process of magnesium stearate, stearic acid should first be saponified with sodium hydroxide solution to obtain sodium stearate, and then react with the solution of magnesium sulfate or magnesium chloride to synthesize magnesium stearate.

The following are the brief three above mentioned processes:

C17H35COOH + NaOH → C17H35COONa + H2O
2C17H35COONa + MgSO4 → (C17H35COO)2 Mg + Na2SO4
2C17H35COONa + MgCl2 → (C17H35COO)2 Mg + 2NaCl
Specification
Other names    Magnesium octadecanoate, Magnesium salts of fatty acids, Magnesium distearate
CAS number    557-04-0
Chemical formula    Mg(C18H35O2)2
Molecular weight    591.27
Melting point    88.5 °C (191.3 °F; 361.6 K)
Properties
With both characteristics of metal salt and stearic acid. The lubricity and hydrophobicity are derived from stearic acid.

Stable, but will be decomposed into stearic acid and magnesium salt in case of a strong acid.

A large specific surface area, with strong adsorption and hygroscopicity, a slippery feeling in contact with the skin and is easy to stick to the skin.

Appearance
An off-white to white powder, greasy to the touch.

Solubility
It is an anionic surfactant, unlike with another two metallic stearates (sodium and potassium stearate) but similar with calcium stearate, it is practically insoluble in water with the solubility 0.004 g/100 mL (25 °C).

Partially soluble in ethanol and ether.

Why is it insoluble in water?

The divalent Mg2+ can bind two nonpolar fatty acid molecules while Na+ and K+ as monovalent ions can only combine with one fatty acid.

Two fatty acid molecules protect Mg2+ from interacting with the water molecules and thus make it insoluble in water.  

Structure
Magnesium stearate chemical structure
Image Source

It exists as a salt containing two stearate anions and a magnesium cation. Totally there are 36 carbons in length of molecule structure.