Skip navigation
Watchlist Sponsored By :


Current DateTime: 02:28:22 12 Nov 2009
LinksList Documentid: 24355697

FEATURED QUIZZES


Current DateTime: 02:28:22 12 Nov 2009
LinksList Documentid: 33793611
  • The Billionaire BFF's

      Philanthropists. Bridge partners. Hockey players. Which responses are based on facts from Buffett's and Gates' real lives?

  • The Many Myths of Coca-Cola

      Can you tell which statements are true, and which ones are just rumors?

  • Think You Understand Markets?

      We've selected some questions from the Financial Industry Regulatory Authority's test of investor knowledge. See how you do ...


Current DateTime: 02:28:22 12 Nov 2009
LinksList Documentid: 24890560
  • Winterizing Your Portfolio

      If 2009 was the winter of our discontent, will 2010 be a winter wonderland for investors? A lot depends on the recovery—or lack thereof.

  • Investor's Guide to Real Estate

      Some even say the long-awaited recovery is here. Regardless, buyers and sellers alike can profit from our guide.

  • Alternative Investing

      Stocks and bonds? Sure. But it's a big world out there for investors.

powered by digg
By: Reuters | 07 Apr 2008 | 07:57 AM ET
Text Size

Credit card network Discover Financial Services said Monday it agreed to buy Citigroup's Diners Club International for $165 million, expanding its global presence.

Diners Club generates more than $30 billion of annual card volume outside North America, where it is accepted at more than 8 million locations in 185 countries, Discover said.

The purchase could help Discover add market share. Its main rivals among card networks include Visa [V  Loading...      ()   ], MasterCard [MA  Loading...      ()   ] and American Express [AXP  Loading...      ()   ].

"We are now able to compete on a global stage," Discover Chief Executive David Nelms said on a conference call.

"Completing (our) strategy to fill out our U.S. and North American acceptance is job one. It's not that global acceptance wasn't particularly important, it just wasn't achievable until now," he added. "This changes all that."

Discover expects to integrate the networks in two to three years. It said this would let its own cardholders use their cards at merchants that accept Diners Club, and Diners Club cardholders use their cards on its own North American network.

The transaction follows Riverwoods, Illinois-based Discover's sale last month of its money-losing Goldfish credit card unit in Britain to Barclays for $70 million.

Discover said it expects Diners Club to initially add $10 million to $15 million of pre-tax profit.

It is not adding credit risk because it will not issue cards or extend consumer credit in international markets.

The transaction will allow Citigroup [C  Loading...      ()   ] to streamline operations and focus on stronger businesses, said Ed Eger, head of international cards at the largest U.S. bank.

New York-based Citigroup has been trying to cut costs and boost efficiency after problems tied to subprime mortgages and other debt led to a $9.83 billion fourth-quarter loss.

Many analysts expect a multibillion-dollar first-quarter loss.

The Diners Club transaction is expected to close within 90 days, pending regulatory approval.

In morning trading on the New York Stock Exchange, Discover shares rose 96 cents, or 5.6 percent, to $18.10, and Citigroup shares rose 87 cents, or 3.6 percent, to $24.95.

Discover [DFS  Loading...      ()   ] shares have fallen by more than one-third since Morgan Stanley spun off the company at $28.50 per share at the end of June 2007.

Copyright 2009 Reuters. Click for restrictions.
Tools:
Print EmailAdd This share icon
  • digg share

CNBC HIGHLIGHTS

  • Warren Buffett and Bill Gates spoke to Columbia students, and Buffett made the students a startling offer.
  • They may have wrecked their companies or saved our economy. Tell us what you think.
  • Big pharma embraces social media, but how much should a tightly regulated sector say on Facebook or Twitter?
  • A European dating site finds lovelorn singles from one country to be consistently uglier. Which is it?
  • Contributor David Pogue looks at two of the latest efforts to perfect the digital pocket camera.
  • PepsiCo is ramping up its onsite health facilities for workers.
ADD COMMENTS
Remaining characters


Current DateTime: 01:20:29 12 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 11:27:47 12 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 11:27:47 12 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 01:00:12 12 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters