Discover Financial Services to Acquire Diners Club International Network

Discover will purchase the business for $165 million. Under the terms of agreement, Discover will acquire the Diners Club International network with more than $30 billion per year in spend volume outside of North America; its brand and trademarks; its employees; and agreements with 44 network licensees who issue Diners Club cards and maintain an acceptance network consisting of more than 8 million incremental merchant and cash access locations in 185 countries worldwide. Citi will remain a significant long-term issuer on the Diners Club network as part of the transaction.

“We expect this acquisition to significantly improve our competitive position by giving us global reach and accelerating growth in our payments network revenues,” said David Nelms, chief executive officer of Discover. “Like Discover, Diners Club International is a pioneer that built its market position through high quality service, superior cardholder benefits, and differentiated products and services. One of its key strengths is the commitment of Diners Club licensees to the Diners Club International brand in local markets. We look forward to working with international licensees to leverage the synergies between our companies to create greater opportunities for our cardholders, merchants and issuers as we continue to invest in the Diners Club brand.”

Over the next two-to-three years, Discover expects to integrate both networks to allow Discover Network cardholders to use their cards at merchants that accept Diners Club cards around the world, and Diners Club cardholders to use their cards on the Discover Network in North America. Participants of Discover Network and Diners Club International licensees are expected to benefit from increased transaction volume resulting from broader acceptance, while merchants outside of North America will benefit from the spending of Discover Network cardholders while traveling.

“Our strategic decision to sell the Diners Club International payments network to Discover is consistent with Citi's efforts to streamline its businesses to focus on what Citi does best. For Citi, this means growing our card issuing businesses around the world,” said Ed Eger, Head of International Cards for Citi. “At the same time, we are excited about the opportunity to work with a long-term partner that has the commitment and experience to expand the acceptance network of such a highly regarded franchise. We look forward to supporting the Diners Club International network and to ensuring a smooth transition for cardmembers and our licensee, merchant, and client partners.”

Diners Club licensees in North America and globally are not included in this acquisition. Diners Club cardmembers can continue to use their cards as usual and will maintain all benefits related to their current card programs. While not included in the transaction at this time, Diners Club assets and employees in France are expected to be included shortly.

Diners Club International has a rich, 50-year heritage as a premium card brand for upscale consumers, frequent travelers and corporations. Since launching the first general purpose credit card in 1950, Diners Club has grown to attain status as a premier global payments network. Discover, a leading credit card issuer and electronic payment services company, has one of the most recognized brands in U.S. financial services.

The combined company will bring together two respected brands with experienced merchant acceptance networks that will enable cardmembers to use their cards in more than 185 countries and territories.

The acquisition is expected to close within 90 days, subject to required regulatory approvals and customary closing conditions.