Retail News Breaks Archives
Sale of credit card receivables eyed by Target
January 13th, 2011
MINNEAPOLIS – Target Corp. is looking to sell its nearly $7 billion credit-card receivables portfolio.
In announcing the purchase of Zellers discount store sites from Hudson's Bay Co. on Thursday, Target also reported that it "intends to actively pursue the sale of its credit-card receivables portfolio" and has engaged payments industry specialist First Anapolis as an adviser.
Target said its credit card receivables totaled $6.7 billion as of Oct. 30, 2010.
The retailer noted that it was seeking "a transaction in which it would retain operational control of its strategically important financial services business, including its deep integration with Target's retail operations."
Any deal also would have to meet "appropriate strategic and financial conditions" as well as be designed to have minimal impact on Target customers and the Target employees who provide the financial products and services, the company added.
Target said it believes that improved portfolio performance, the successful launch of its REDcard Rewards program and the current conditions in the capital markets provide "an attractive opportunity" to entertain a potential sale of its credit card receivables.