By Ovunc Kutlu
ISTANBUL (AA) - American bank holding company Capital One announced Tuesday it will acquire Discover Financial Services in an all-stock transaction valued at $35.3 billion.
"Under the terms of the agreement, Discover shareholders will receive 1.0192 Capital One shares for each Discover share, representing a premium of 26.6% based on Discover's closing price of $110.49 on February 16, 2024," it said in a statement.
At the closing of the deal, Capital One shareholders will own approximately 60% and Discover shareholders will own approximately 40% of the combined company, the statement added.
"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," said Richard Fairbank, founder, chairman and CEO of Capital One.
Discover CEO President Michael Rhodes said the transaction will accelerate growth and maximize value for the shareholders.
The deal is expected to close in late 2024 or early 2025.
The two companies are among the US' biggest credit card issuers.