The deal was first announced in February 2013, when Capital One said they were selling the Best Buy portfolio to Citi for about $7 billion. Capital One did not indicate a reason for the sale, but said they did not expect to absorb any losses from it.
Citi owns many store card portfolios, including The Home Depot, Macy’s, and Sears. They manage nearly 90 million retail accounts and also have gas credit card holdings with the Shell and ExxonMobil co-branded gas cards to their name. Citi is one of the biggest banks in the world, with more than 200 million customers all over the world. They manage bank accounts, credit cards, securities and brokerages and provide wealth management to high-profile clients.
The deal was completed relatively quickly; a fact that Citi Retail Services CEO Bill Johnson said was remarkable. “Executing a conversion of this size in less than seven months is unheard of in the industry,” said Johnson.
The acquisition was announced in February and completed in September. Citi reports that the portfolio is currently worth over $6 billion.
Best Buy cards help consumers save on electronics
People who shop at Best Buy can get special financing and enjoy discounts at the electronics retailer. There are rewards programs offered to Best Buy cardholders, and these programs were not expected to change due to the handover from Capital One to Citi.
Around the holidays, Best Buy offers steep discounts on things like flat screen TVs and laptops, often in high demand by consumers looking for big sales.
Best Buy is based in Minneapolis, Minnesota and their second-quarter earnings in 2013 were a reported $266 million on revenue of $9.3 billion.
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