Citigroup to Buy Federated, May Credit Card Portfolios

Share this content:
Citigroup Inc. will acquire all the accounts in the credit card portfolios of Federated Department Stores Inc. and The May Department Store Company, Cincinnati-based Federated reported yesterday.


The credit card businesses have a combined $6.6 billion in receivables and 17 million active accounts. Citigroup will buy them in three transactions and is expected to pay an 11.5 percent premium, or about $760 million. Federated said it expects after-tax proceeds of about $4.5 billion from the sale, which it plans to use to fund its acquisition of May.


Federated and Citigroup also entered into a multi-year agreement to co-manage the accounts that provides for Federated to receive ongoing payments based on credit sales and other performance metrics of the credit portfolio after the sale is completed.


The two companies also will work together on marketing initiatives designed to accelerate Federated's same-store sales gains and credit growth.


No changes are planned for Federated's credit card or loyalty reward programs as a result of this transaction.


Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM News.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


close

Next Article in Multichannel Marketing

Sign up to our newsletters

Company of the Week

USAData helps businesses find new customers and grow their current customers through a combination of data and digital marketing services, and easy-to-use SaaS technology products. We enrich customer data so businesses can more effectively target and communicate with customers, and connect them with their best look-alike prospects through digital and traditional channels. We make it easy through simple, self-serve applications and APIs, as well as through full-service programs managed by our Data and Digital experts. 

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above