Stamford-headquartered Synchrony (NYSE:SYF) is acquiring the point of sale financing business, including $2.2 billion of loan receivables, from Ally Financial Inc. (NYSE:ALLY).
The acquired portfolio includes relationships with nearly 2,500 merchant locations and supports more than 450,000 active borrowers in home improvement services and health care. Synchrony stated the acquisition will enable it to simultaneously offer revolving credit and installment loans at the point-of-sale in the home improvement vertical while extending its products to Ally Lending’s merchants. The company added the Ally Lending health portfolio will complement its existing health and wellness platform while extending its reach in the cosmetic, audiology and dentistry markets.
Synchrony added that it would provide more information regarding the acquisition during its fourth quarter 2023 earnings conference call on Jan. 23.
“This deal represents a significant and exciting growth opportunity for Synchrony – it’s a strong strategic fit that will unlock value and operational efficiency by integrating products and teams in our expanding platforms of home improvement and health and wellness,” said Synchrony President and CEO Brian Doubles. “This accretive acquisition enhances Synchrony’s position by offering our multi-product portfolio to nearly 2,500 Ally Lending merchant locations, and enables us to achieve attractive economies of scale while further diversifying our merchant base.”
“Today’s agreement to sell Ally Lending is part of a broader initiative to invest resources in growing scale businesses and strengthening relationships with dealer customers and consumers,” said Ally Financial CEO Jeff (JB) Brown. “This transaction allows us to continue to be disciplined in allocating capital to optimize risk-adjusted returns as we manage through a dynamic operating environment.”
