Capital One Financial Corporation Capital is set to acquire HSBC's domestic credit card segment from for a premium of $2.59 billion. The deal comes with HSBC’s $30 billion credit card portfolio, for an 8.75% premium to par value of all receivables. However, HSBC will hold on to its $1.1 billion HSBC Bank USA credit card assets.

Capital One plans to pay a portion of the deal with cash and the remainder with the proceeds from the balance sheet repositioning related to the pending ING Direct acquisition. It has the option of issuing $750 million of the $1.25 billion to HSBC at $39.23 per share, which is the average of the closing prices of Capital One shares from August 8 and 9, 2011.

Subscribe Now

Complete access to real-time information and analysis of news and trends in the industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.