Consumer lender Ally Financial to sell credit card business to CardWorks

Published 01/22/2025, 07:46 AM
Updated 01/22/2025, 10:21 AM
© Reuters. FILE PHOTO: The logo and trading information for Ally Financial Inc appear on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 24, 2019. REUTERS/Brendan McDermid/File Photo
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(Reuters) -Consumer lender Ally Financial (NYSE:ALLY) 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.

© Reuters. FILE PHOTO: The logo and trading information for Ally Financial Inc appear on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 24, 2019. REUTERS/Brendan McDermid/File Photo

Last year, Ally sold its lending business to Synchrony Financial (NYSE:SYF), 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.

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