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Discover Financial Services Announces Pricing of Public Offering of Common Stock

Posted by Dana in July 8th 2009

Discover Financial Services (NYSE:DFS) announced the pricing of a public offering of 54,054,055 shares of its common stock at a public offering price of $9.25 per share. The company has granted the underwriters a 30-day option to purchase up to an additional 8,108,108 shares to cover over-allotments, if any.

Discover will receive estimated net proceeds from the offering of approximately $480.3 million, or approximately $552.4 million if the underwriters choose to exercise the over-allotment option in full. The offering is expected to close on July 13, 2009. The net proceeds from the offering will be used for general corporate purposes, which may include capital contributions to the company’s subsidiary, Discover Bank, possible investments in the company’s businesses, or possible repurchase of fixed rate cumulative perpetual preferred stock issued by Discover to the U.S. Treasury under its Capital Purchase Program (subject to regulatory approval).