Capital One Acquires Discover Financial Services

Capital One Financial Corporation (NYSE: COF) has announced its acquisition of Discover Financial Services (NYSE: DFS) in an all-stock transaction valued at $35.3 billion. The transaction will see Discover shareholders 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.

Richard Fairbank, Founder, Chairman, and Chief Executive Officer of Capital One, expressed his enthusiasm for the acquisition, saying, "From Capital One’s founding days, we set out to build a payments and banking company powered by modern technology. 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."

Michael Rhodes, CEO and President of Discover, echoed Fairbank's sentiment, stating, "The transaction with Capital One brings together two strong brands with enhanced ability to accelerate growth and maximizes value for our shareholders, enabling them to participate in the tremendous upside of the combined company."

The acquisition is expected to create a global payments platform at scale, with 70 million merchant acceptance points in more than 200 countries and territories, positioning the combined company to compete with the largest payments companies and deliver enhanced value to a franchise of over 100 million customers. Capital One anticipates leveraging its customer base, technology, and data ecosystem to drive more sales for merchants and offer great deals for consumers and small businesses.

The companies plan to host a conference call on February 20, 2024, at 8:00 am ET to discuss the acquisition.

The full 8-K submission from Capital One Financial Corporation is available here.

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