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Washington, February 20 (HS). US bank Capital One Financial Corp on Monday announced the acquisition of credit card lender Discover Financial Services. The deal will merge the two largest credit card companies in the United States, The New York Times reports.
The all-stock transaction valued Discover Financial Services at $35.3 billion, according to The New York Times. Matt Schultz, chief credit analyst at LendingTree, says Capital One is one of the nation's largest banks with $479 billion in assets. It issues credit cards on a network operated by Visa and MasterCard. The acquisition of Discover will give it access to a credit card network of 305 million cardholders. This will add to its customer base of more than 100 million. The four major networks in the country are American Express, MasterCard, Visa and Discover.
According to the report, consumer advocates rejected the potential deal, saying it raises antitrust concerns. “It is very difficult to imagine how federal regulators could allow Capital One to buy Discover, given the risks the merger would pose to the public as well as insiders,” Jesse Van Tol, chief executive of the National Community Reinvestment Coalition, said in the statement. People will also benefit.”
