Ally Financial to acquire CardWorks in $2.65 billion deal

Auto lender Ally Financial announced it will acquire CardWorks for ~$2.65 billion.

Founded in 1987, Cardworks is a non-prime credit card and consumer finance lender with a full-spectrum unsecured servicing platform and robust merchant services capability. Under the terms of the agreement, Merrick Bank, a wholly-owned subsidiary of CardWorks, Inc., will merge into Ally Bank. It is headquartered in Woodbury, NY with facilities in Florida, Utah and Pennsylvania.

The deal will further diversify Ally’s product offerings, adding an established credit card platform, full-spectrum servicing and recovery operation and a nationwide merchant acquiring business. These additional capabilities immediately enhance Ally’s direct bank deposit and consumer product platform and complement the company’s market-leading auto finance, insurance, and commercial product lines. Upon completion of the transaction, Ally will provide over 11 million customers in all 50 states with compelling secured and unsecured banking products.

“CardWorks represents an industry-leading credit card platform in the U.S., and this acquisition serves as an important milestone in Ally’s evolution to be a full-service financial provider for our customers. I have tremendous admiration for the three decades of leadership Don Berman has provided as founder and CEO and remain impressed with what the entire team has accomplished in building a resilient, growing business with a commitment to the customer. Beyond the compelling strategic rationale and financial enhancements this transaction brings, CardWorks is an ideal cultural fit for Ally. Both companies share a deep-rooted history of disciplined risk management and an obsession over the customer. I’m thrilled to welcome CardWorks to the Ally team and look forward to adding value for all of our stakeholders.” – Ally Chief Executive Officer Jeffrey J. Brown.