Saks Sells Card Business to Household International

Saks (SKS Quote) is leaving the credit business.

The upscale retailer said Friday it was selling the majority of its private label credit card accounts to Household International (HI Quote), a consumer finance company, in a deal valued at roughly $1.4 billion. Household will pay Saks more than $300 million in cash and assume about $1.1 billion worth of Saks' securitized liabilities.

As part of the deal, the two companies struck a 10-year alliance, in which Household will own most new accounts and balances during the period, with Saks performing customer service. Saks will receive a fee from Household for such services, and said the deal would be neutral to its earnings in 2003 and modestly accretive in 2004. ...