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Wachovia sells card unit
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April 9, 2001: 11:05 a.m. ET
Bank One, nation's largest Visa issuer, buying Wachovia's $8B card portfolio
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NEW YORK (CNNfn) - Bank One Corp., the largest issuer of Visa credit cards, agreed Monday to buy the $8 billion credit card portfolio of Wachovia Corp.
Terms of the deal were not announced, although Wachovia said it will report a pre-tax gain of $1.4 billion. The companies said that about 2.8 million customer accounts will move to First USA, Bank One's credit card unit.
Chicago-based Bank One (ONE: up $0.22 to $33.83, Research, Estimates) is the nation's fifth-largest bank holding company. Wachovia (WB: up $0.77 to $59.12, Research, Estimates) will continue to offer its branded credit cards to retail customers, with First USA servicing the customers.
Bank One said the acquisition should add to earnings per share immediately, and that it will increase after-tax earnings by $100 million annually.
Wachovia announced in February that it was exploring strategic alternatives for its credit card business. The company told investors in March said that proceeds of any sale would be used for internal reinvestment, strategic acquisitions and share repurchases.
The companies said they expect the deal to close in the second quarter, subject to any regulatory approval. They could not say what will happen to Wachovia's credit card staff.
"Over the next several weeks, First USA will be reviewing its needs with respect to Wachovia Bank Card Services facilities and employees," they said. 
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