TORONTO - BMO Financial Group (TSX:BMO) says it has agreed to buy the Diners Club North American franchise from Citigroup.
BMO said the deal will more than double its corporate card business, representing US$7.8 billion in card transactions annually and net receivables of almost US$1 billion
The deal gives BMO exclusive rights to issue Diners Club cards to corporate and professional clients in the United States and Canada.
The deal is expected to close around the end of March 2010.
"This acquisition will immediately enhance our competitive position by placing us among the top commercial card issuers in North America," said Frank Techar, BMO's president and chief executive officer of personal and commercial banking.
BMO is the only large Canadian bank to use MasterCard is its main credit card. Its peers are primarily Visa issuers.
"Acquiring the North American franchise offers the best of both worlds for BMO, combining the benefits of worldwide MasterCard acceptance and the strength of Diners' capabilities and highly regarded rewards program," said Mike Kitchen, BMO's senior vice-president of personal and commercial banking.
BMO said the deal also strengthens its global reach allowing it to partner with other Diners Club franchises around the world.
Citigroup will continue to provide support until the Diners Club business is fully integrated within BMO.
Further details of the deal were not disclosed.
- PHOTOS: What's Brewing in Steamy Hallows, the Harry Potter-Inspired Cafe19 Pictures
- PHOTOS: Frida Kahlo at the Brooklyn Museum doesn't hold back23 Pictures