Citi offloads Diners Club

8 April 2008

Diners Club International is being sold by Citigroup for $165 million, it has been announced.

The world's oldest credit card firm is being bought by Discover Financial Services, owners of the Discover Card.

Under the terms of the deal, the firm will not provide credit directly to Diners Club customers, but will take over processing its transactions and running its licensing agreements.

Yesterday, Discover shares rose by 5.5 per cent to $18.09 - with Citi also climbing by 2.2 per cent to $24.60.

Speaking to Forbes, card industry analyst Red Gillen commented: "With this acquisition, Discover has certainly upped the ante in the card market, but it will soon have to prove that its strategy and investments are chipping away at the other major payment brands."

Aquiring the brand will mean that Discover customers will soon be able to use their cards when they travel abroad.

Citi originally bought Diners Club in 1981.

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