47% of interest of Discount retailer Target Corp.

[img_assist|nid=7172|title=|desc=|link=none|align=left|width=100|height=67]J.P. Morgan Chase & Co. is acquiring an undivided interest representing 47% of Target's $8.2 billion credit-card portfolio for $3.6 billion. The deal is twice as much as analysts have predicted.

J.P. Morgan is buying a 47% stake in Target's credit-card receivables, but the deal is structured more like a loan than a sale. Target is expected in years five and six to repay the investment through the performance of the credit-card portfolio.

Previously Target was very reluctant to sell the unit. However after William Ackman's Pershing Square Capital Management hedge fund acquired a 9.6% stake in the company last July it decided to consider potential sale of credit portfolio.

In spite of the rise of pretax earnings from credit-card operations in the fourth quarter credit-card companies in general have run into trouble as the economy continues to worsen. Therefore some people doubted the sale to be possible. This winter analysts predicted that the unit would be sold for $2 billion if it was purchased at all.