Capital One announced it’s acquiring Discover Financial Services for $35.3 billion in an all-stock deal, giving the bank a leg up in the competitive credit card market.
Under the terms of the deal announced Monday evening, Discover (DFS) shareholders will receive a little over one share of Capital One (COF) for every Discover share they own.
If the deal is finalized, current Capital One shareholders will own a 60% stake in the combined company, while Discover shareholders will own the remaining 40%.
Capital One said it believes the deal will close in late 2024 or early 2025.
A marriage between Capital One and Discover, if approved by regulators, would also give Capital One a new source of revenue from the merchant fees it collects.
Currently, Capital One issues credit cards with Mastercard, Visa and Discover.
The deal would likely result in more of its cards getting switched to the Discover network, the Wall Street Journal reported earlier on Monday before the deal was officially announced. »