Capital One Financial Corp. intends to purchase Discover Financial Services in an all-stock deal that one analyst notes would “effectively create the largest card issuer in the U.S.” Capital One
COF,
+0.64%
announced the deal late Monday after various outlets reported that a transaction was near. Discover
DFS,
-0.21%
shareholders would receive 1.0192 Capital One shares for each Discover share, which would represent a more than 26% premium to Discover’s Friday close of $110.49.
The companies said the transaction is valued just upward of $35 billion. “Our acquisition of Discover is a singular opportunity to bring together two very successful companies with complementary capabilities and franchises, and to build a payments network that can compete with the largest payments networks and payments companies,” Capital One Chief Executive Richard Fairbank said in a release. That release calls out Discover’s “rare and valuable global payments network,” while noting that it’s still the smallest of the four U.S.-based networks. “This acquisition adds scale and investment, enabling the Discover network to be more competitive,” the companies said. Piper Sandler’s Kevin Barker wrote in a late Monday note to clients that the deal would establish the combined company as the largest card issuer as measured by card loans outstanding, which he said was $257 billion. JPMorgan Chase & Co.
JPM,
-0.47%
has $211 billion, he …
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COF,
+0.64%
announced the deal late Monday after various outlets reported that a transaction was near. Discover
DFS,
-0.21%
shareholders would receive 1.0192 Capital One shares for each Discover share, which would represent a more than 26% premium to Discover’s Friday close of $110.49.
The companies said the transaction is valued just upward of $35 billion. “Our acquisition of Discover is a singular opportunity to bring together two very successful companies with complementary capabilities and franchises, and to build a payments network that can compete with the largest payments networks and payments companies,” Capital One Chief Executive Richard Fairbank said in a release. That release calls out Discover’s “rare and valuable global payments network,” while noting that it’s still the smallest of the four U.S.-based networks. “This acquisition adds scale and investment, enabling the Discover network to be more competitive,” the companies said. Piper Sandler’s Kevin Barker wrote in a late Monday note to clients that the deal would establish the combined company as the largest card issuer as measured by card loans outstanding, which he said was $257 billion. JPMorgan Chase & Co.
JPM,
-0.47%
has $211 billion, he …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]