Hawley advocates for government to block Capital One acquisition of Discover



Republican Sen. Josh Hawley of Missouri has urged Jonathan Kanter, assistant attorney general for the Justice Department's Antitrust Division, to seek to put the kibosh on the planned acquisition of Discover by Capital One.

"This is destructive corporate consolidation at its starkest. If consummated, this merger will create a new juggernaut in the credit card market, with unprecedented powers to extort American consumers," Hawley declared in a letter to Kanter.

"You, in partnership with other regulators, must take the lead in blocking this merger. No doubt a legion of proxies and allies for the financial industry will soon emerge, claiming that this proposed deal will benefit consumers. That is doubtful. If the last several decades of American political economy indicate anything at all, it's that the supposed benefits of monopoly never trickle down to the public at large. Instead, consolidation redounds to the benefit of shareholders and a handful of top executives—not ordinary Americans," the senator wrote.

Democratic Sen. Elizabeth Warren of Massachusetts has also called for killing the acquisition.

"The merger of @CapitalOne and @Discover threatens our financial stability, reduces competition, and would increase fees and credit costs for American families. This Wall street deal is dangerous and will harm working people. Regulators must block it immediately," Warren declared in a post on X.

A press release about the deal notes that, "Under the terms of the agreement, Discover shareholders will receive 1.0192 Capital One shares for each Discover share, representing a premium of 26.6% based on Discover's closing price of $110.49 on February 16, 2024."

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'You are the threat to financial stability': Peter Schiff blasts Sen. Warren as she calls for regulators to kill major merger



Democratic Sen. Elizabeth Warren of Massachusetts is calling for regulators to put the kibosh on plans for Capital One to acquire Discover.

According to a press release, Discover shareholders will get 1.0192 Capital One shares per Discover share that they own.

But Warren wants regulators to scuttle the deal.

"The merger of @CapitalOne and @Discover threatens our financial stability, reduces competition, and would increase fees and credit costs for American families. This Wall street deal is dangerous and will harm working people. Regulators must block it immediately," Warren declared in a post on X.

Euro Pacific Asset Management chief economist and global strategist Peter Schiff responded to Warren's post, writing, "You are the threat to financial stability. Thanks to your reckless spending Americans are responsible to repay a $34 trillion National Debt. Plus, taxes, regulation, and government created inflation are the main reasons Americans rely so heavily on credit cards to make ends meet."

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Senate Banking, Housing, and Urban Affairs Committee chair, Democratic Sen. Sherrod Brown of Ohio said in a statement, "We will be monitoring all developments to ensure that this merger doesn't enrich shareholders and executives at the expense of consumers and small businesses."

Both Capital One and Discover promote ESG ideology.

"Discover has built a rare and valuable global payments network with 70 million merchant acceptance points in more than 200 countries and territories. Even so, it is the smallest of the four US-based global payments networks. This acquisition adds scale and investment, enabling the Discover network to be more competitive with the largest payments networks and payments companies," the press release about the deal states.

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Capital One to acquire Discover — and both of the big businesses are on the ESG bandwagon



Capital One will acquire Discover, according to a press release, which notes that those holding Discover shares will receive shares of Capital One stock.

"Our acquisition of Discover is a singular opportunity to bring together two very successful companies with complementary capabilities and franchises, and to build a payments network that can compete with the largest payments networks and payments companies," Capital One founder, chairman, and CEO Richard Fairbank said, according to the press release.

Discover investors will get slightly more than one share of Capital One per share of Discover that they hold.

"Under the terms of the agreement, Discover shareholders will receive 1.0192 Capital One shares for each Discover share, representing a premium of 26.6% based on Discover's closing price of $110.49 on February 16, 2024. At close, Capital One shareholders will own approximately 60% and Discover shareholders will own approximately 40% of the combined company," the press release notes. Discover "is the smallest of the four US-based global payments networks. This acquisition adds scale and investment, enabling the Discover network to be more competitive with the largest payments networks and payments companies," the release noted.

Both companies promote environmental, social, and governance, or ESG, ideology.

Discover released an ESG report last year that listed goals such as increasing the representation of women and non-whites in "all management levels by 2025."

"Increase POC to 40%" the report stated as a goal, providing a footnote that explained, "POC is defined as People of Color; POC comprises all races/ethnicities in the United States that are not categorized as White/Caucasian." Other objectives included increasing "women to 50%" and "Black and Hispanic to 15%."

Capital One released an ESG report last year that noted "In the three year-period from 2019 to 2022, in the U.S., Asian and Pacific Islander VP+ representation has grown 28 percent, Black VP+ representation has grown 128.6 percent, Hispanic VP+ representation has grown 16.7 percent and women’s VP+ representation has grown 8.5 percent."

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Superpower No More? | 8/19/21

Superpower No More? | 8/19/21