When Capital One completed its $35 billion acquisition of Discover Financial Services in May, it brought two credit card giants and thousands of employees under one roof.
Discover's former headquarters in northern suburb Riverwoods may have a little more space these days after the newly merged company laid off nearly 600 employees in August and September.
In August, Capital One filed notice with the state that it was laying off 215 employees associated with Discover's home equity and loan refinancing business, which the combined company was exiting. Last month, Capital One filed another notice that the company would lay off at least 382 additional employees following the megamerger.
Most of the laid-off employees plan to leave the company by the end of the year.
“When we first announced the acquisition of Discover, we recognized that combining the two companies would involve difficult choices and changes,” a Capital One spokesperson said in a statement Monday. “After careful consideration, we have announced the decision to eliminate certain roles as part of our continued integration efforts.”
In February 2024, Virginia-based Capital One announced it would buy Discover for $35 billion, merging the two largest credit card companies and ending the long-term prospect of establishing a corporate headquarters in the Chicago area.
At the time the deal was announced, approximately 4,000 Discover employees were connected to the Riverwoods headquarters.
The Illinois Worker Adjustment and Retraining Notification Act requires businesses with 75 or more employees to provide the state with 60 days' advance notice of impending business closures or mass layoffs.
The August notice was related to the closure of mortgage lending company Discover, which was not part of Capital One's portfolio. Of the 215 furloughed employees, 51 worked at the Riverwood facility, nine were Illinois residents working remotely and 155 worked remotely out of state, the company said.
The layoffs, announced in September, reflect “the elimination of a number of acquisition-related positions,” a Capital One spokesperson said. The total includes 200 employees working at the Riverwood facility, 18 Illinois residents working remotely and 165 out-of-state, the company said.
While most of the laid-off employees will leave the company by the end of the year, some will remain with the company through March, the company said.
“Our focus now is to fully support our colleagues impacted by these changes,” a Capital One spokesperson said. “We have provided affected employees with at least 60 days’ notice and are providing comprehensive career transition support, including enhanced severance packages, benefits and employment resources.”
The downsizing of Discover, long the largest company based in Riverwood, is nonetheless a challenge for the rural village of fewer than 4,000 people located west of Deerfield along the Tri-State Tollway.
For Riverwood Mayor Christine Ford, the immediate impact of the layoffs may be somewhat mitigated by the number of remote workers brought in, she said. But her main concern is the long-term fate of the campus itself.
It's a large piece of land for a small community with a “big, beautiful campus” in a valuable location, and Ford said she hopes they plan to stay.
Kevin Considine, president and CEO of Lake County Partners, the county's development agency, said that while the layoffs were “unfortunate,” they were not unexpected given the merger. He hoped that “high-growth companies” such as Fortune Brands Innovations, located less than a mile east of Lake Cook Road in Deerfield, might be able to hire some of Discover's laid-off former employees.
“There seems to be a pretty good match,” Considine said.
The Discover card was launched nationally in 1986 by then-owner Sears to compete for consumer wallet space with Visa, Mastercard and American Express.
Capital One intends to continue offering the Discover credit card alongside its own brand cards, the company said. But Discover is now fully integrated into Capital One.
Discover's 1.1 million-square-foot headquarters have long been located on a sprawling 25.5-acre site along Lake Cook Road in Riverwood. Its status has now been downgraded to Capital One's corporate site, which it shares with facilities in New York, downtown Chicago, San Francisco, Toronto and several other locations.
At Riverwood, a four-building complex surrounds a large pond on a surprisingly secluded campus marked by a large Discover sign and set back from the road behind a long driveway, ample parking and a security gate.
The gray stone and glass main building, built in 1988, features a prominent four-story rotunda at the center, extending with wings on either side. Three additional buildings with the same façade, opened in 2003, are connected by glass walkways.
At noon Tuesday, the parking lot was full and the campus was bustling with activity as employees entered and exited buildings. While the Riverwood plant still employs about 4,000 people, with most of the layoffs occurring over the next two months, there may be fewer people there in the new year.
Capital One remains committed to the Riverwoods facility and its satellite Discover location in Chicago's River North neighborhood, which opened in 2014, the company said Tuesday.
Although the number of employees in Riverwood may be declining, Capital One has made good on its pre-merger promise to increase its workforce severalfold. Discover the call center on Chicago's South Side as part of a massive public benefit plan announced last year.
The five-year, $265 billion plan, which covers Capital One's territories nationwide, included a commitment to not only maintain Discover's four-year-old call center in the Chatham area, but also to increase the number of jobs from 600 to 1,000, which was the original hiring target.
Capital One has already achieved that goal, the company said Tuesday.
Tribune reporter Joseph States contributed.
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