Capital One, Discover clear hurdles for $35.3B megadeal

Announced in February, McLean-based Capital One Financial’s proposed $35.3 billion acquisition of Discover Financial Services is moving forward, with stockholders’ votes scheduled early next year, the credit card giants announced this week.

Capital One also announced Thursday it received approval from the Office of the Delaware State Bank Commissioner on Wednesday to complete the purchase of Discover Financial Services and its subsidiary, Discover Bank, a Delaware-chartered bank. On Tuesday, both companies said special stockholders’ meetings are scheduled Feb. 18, 2025, to allow holders of Discover and Capital One common stock to vote at their company’s respective meeting to approve the deal.

According to Thursday’s news release, Capital One expects the transaction to close in early 2025, pending approval by both banks’ stockholders and approval by the Federal Reserve Board of Governors.

The all-stock acquisition, Capital One’s largest ever purchase, has been under regulatory scrutiny. Two Capital One cardholders filed a federal class action lawsuit against Discover and Capital One in July, claiming the megadeal would violate antitrust law, but the case was paused in October, pending further action by the U.S. District Court for the Eastern District of Virginia. In July, Capital One committed to spend $265 billion over five years to lending, philanthropy and investment if the deal goes through.

New York Attorney General Letitia James also launched an investigation to determine whether the acquisition violates the state’s antitrust laws, and in October, she asked a state judge to subpoena Capital One for documents she said she needed for her probe, Reuters reported. However, following President-elect Donald Trump’s victory in November, shares of Discover and Capital One jumped, as investors appeared to have greater faith that the deal would go through under his administration.

A Fortune Global 500 company, Capital One had $353.6 billion in deposits and $486.4 billion in total assets as of Sept. 30.