Walmart has dropped a three-month-old lawsuit against Synchrony, clearing the way for the financial services firm to continue issuing private-label credit cards for Sam’s Club.
The dispute stemmed from the discounter’s decision last summer to move the private-label credit card business for its namesake Walmart stores and website to Capital One Financial Corp. According to Bloomberg, the retailer sued Synchrony over ownership of the $10 billion portfolio, which the firm had planned to keep or sell to Capital One.
In a statement released today by Synchrony, the company said it “has reached agreement on the sale of the Walmart loan portfolio,” which is expected to transfer late in the third quarter or early in the fourth quarter. In turn, Walmart has agreed to dismiss the lawsuit, and has extended Sam’s Club’s 26-year Synchrony partnership. The length of the renewal was not disclosed.
“We are very pleased to have reached these agreements,” said Synchrony president/CEO Margaret Keane. “Obtaining certainty around the Walmart portfolio and a renewal on Sam’s Club is a great outcome for the company.”
As part of the extension, Synchrony will continue to manage and service co-branded and private-label credit card programs for the wholesale club’s Club and Plus members across its nearly 600 locations. The plastic, which doubles as membership cards, variously offers cash-back rewards, in-club cash access, special financing promotions, online account management, and scan-and-go integration.
Synchrony also provides customized financing programs to retailers including Amazon, Lowe’s and the Nationwide Marketing Group, as well as to the health, auto, travel and home industries, racking up more than $140 billion in financed sales. It presently maintains 80.3 million active accounts.