Capital One Financial has announced its acquisition of Riverwoods-based Discover Financial Services for a whopping $35.3 billion, uniting two of the nation’s largest credit card companies. The all-stock transaction will see Capital One shareholders receiving shares valued at approximately $140, while Discover shareholders will hold a 40% stake in the combined company.
This merger brings together two major players in the credit card industry that are not traditional banks like JPMorgan Chase and Citigroup (with American Express being an exception). Upon completion, current Capital One shareholders will own 60% of the new entity while Discover remains with 40%.
Discover’s corporate headquarters is located at 2500 Lake Cook Road in Lake County and employs over 5,000 individuals in Chicago alone. Meanwhile, Capital One is based out of McLean,Virginia and expects this deal to generate $2.7 billion in pretax synergies as well as increase adjusted EPS by more than15% by2027.The brand name “Discover”will reportedly be retained under this agreement.
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