Sullivan & Cromwell is advising Ally Financial in the acquisition. Goldman Sachs served as financial adviser to Ally, while Wachtell, Lipton, Rosen & Katz served as legal counsel to CardWorks for the transaction.
Digital financial services company Ally Financial announced that it will acquire non-prime credit card and consumer financing company CardWorks. The deal, which has been approved by both companies’ boards, is valued at $2.65 billion ($1.35 billion in cash and $1.3 billion in Ally stock).
The acquisition adds a top-20 U.S. credit card platform and a top-15 merchant acquiring business to Ally Financial’s direct bank deposit, auto financing, insurance, and commercial product lines. The combined entity will serve 11+ million customers in 50 states.
The transaction is subject to regulatory approval and closing conditions, and is expected to close in the third quarter of 2020.
The S&C team is led by financial services partners Mitch Eitel (Picture) and Andrew Gerlach. Partner Marc Trevino and special counsel Rebecca Coccaro are advising on executive compensation matters. IP partner Mehdi Ansari is advising on intellectual property issues, and partner Eric Wang is advising on tax matters. Associates Nathan Baum, Blake Schell, RuiHui Yu, and Jonathan Rhein also provided valuable assistance.
Involved fees earner: Mehdi Ansari – Sullivan & Cromwell; Nathan Baum – Sullivan & Cromwell; Rebecca Coccaro – Sullivan & Cromwell; Mitchell Eitel – Sullivan & Cromwell; Andrew Gerlach – Sullivan & Cromwell; Jonathan Rhein – Sullivan & Cromwell; Blake Schell – Sullivan & Cromwell; Marc Trevino – Sullivan & Cromwell; Davis Wang – Sullivan & Cromwell; RuiHui Yu – Sullivan & Cromwell;
Law Firms: Sullivan & Cromwell;
Clients: Ally Financial Inc.;