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Update 12:45 p.m.: Adds WSJ report that a deal may be announced Tuesday.
Capital One Financial (New York Stock Exchange:COF) is evaluating a possible purchase of Discover Financial Service (New York Stock Exchange: DFS).
Capital One (COF) has been working with advisors to consider a possible acquisition of Discover (DFS), according to a Bloomberg Report on Monday, which cited people familiar with the matter.
Separately, the WSJ reported On Monday, citing people familiar with the matter, Capital One (COF) is buying Discover (DFS) and a deal may be announced as soon as Tuesday.
Discover Financial (DFS) has a market capitalization of about $28 billion and a deal is expected to value the credit card company at a premium above that figure, the WSJ said. Capital One (COF) is valued at $52 billion.
Deliberations on a possible transaction are ongoing and there is no certainty that they will lead to a purchase, according to the Bloomberg report.
Discover shares gained 15% last year, while Capital One jumped more than 40%.
Capital One (COF) and Discover (DFS) did not immediately respond to Bloomberg's requests for comment.
Capital One's (COF) last major acquisition was more than a decade ago, when it bought the US online bank from ING Group in 2012 for more than $9 billion in cash and stock.
Discover (DFS) in December named Michael G. Rhodes, most recently head of the Canadian Personal Banking group at TD Bank (TD), as its next CEO and president effective March 6 or sooner. The credit card company also announced in late November that it is considering selling its student loan portfolio.
Discover (DFS) will be presented at the UBS Financial Services Conference on February 26.
