Consumer lender Ally Financial to sell credit card business to CardWorks (updated)

Ally Financial

22/01/2025 13:50

(Adds details throughout)
       Jan 22 (Reuters) - Consumer lender Ally Financial
 ALLY.N  has agreed to sell its credit card business to credit
and payments firm CardWorks, the companies said on Wednesday.
    Shares of Ally jumped 8.6% in premarket trading.
    The sale comes as Ally looks to simplify and streamline its
structure and focus on its core businesses.
    The deal includes Ally's $2.3 billion in credit card
receivables with 1.3 million active cardholders as of Dec. 31.
    "This portfolio and platform acquisition is an exciting step
in the expansion of our near-prime credit card business," said
CardWorks CEO Dan Pillemer.
    The deal is expected to close in 2025.
    Last year, Ally sold its lending business to Synchrony
Financial  SYF.N , which included loan receivables worth $2.2
billion.
    J.P. Morgan Securities and Sullivan & Cromwell advised Ally
on the deal, while CardWorks consulted with Cravath and Swaine &
Moore.

 (Reporting by Prakhar Srivastava in Bengaluru; Editing by Anil
D'Silva and Vijay Kishore)
 ((Prakhar.srivastava2@thomsonreuters.com;))