Capital One Is Buying Discover. Here's Why It Could Create Big Growth Opportunities for Investors.
Capital One Financial (NYSE: COF) shocked the financial industry by announcing that it has agreed to acquire fellow credit card-focused bank Discover Financial Services (NYSE: DFS) in an all-stock transaction.
This deal combines two of the largest players in the credit card industry and creates some interesting possibilities for efficiency as well as long-term growth. Here's a rundown of what investors should know about the acquisition and what it could mean over the long run.
As mentioned, the deal is an all-stock acquisition. And as is the case with most acquisitions, the acquirer (Capital One) is paying a premium. Upon closing of the deal, which is expected in late 2024 or early 2025, Discover shareholders will receive 1.0192 shares of Capital One stock for every Discover share they own. For example, if you own 100 shares of Discover, you'll have 101.92 shares of Capital One when the acquisition is done.
Source Fool.com
