Synchrony Financial (NYSE:SYF) is soon to be one asset larger if an agreed deal goes through. The store payment card specialist announced Tuesday that it has signed a definitive agreement to acquire privately held Allegro Credit. The price of the transaction was not disclosed.

Owning Allegro would complement Synchrony's client base, which is still concentrated on the retail stores that have collectively taken an enormous hit due to the economic fallout of the coronavirus pandemic. The somewhat eclectic Allegro specializes in consumer financing solutions for audiology products, musical instruments, and dental services. Its point-of-sale service network covers 3,200 merchants.

A person in a clothing store holding a tablet.

Image source: Getty Images.

"The acquisition advances Synchrony's growth and diversification strategy and accelerates its industry leading digital innovation, expanding choice at the point-of-sale for its providers, merchants and customers," Synchrony wrote in the press release trumpeting the deal.

Much of Allegro's business will be folded into Synchrony's CareCredit, its health and wellness financing unit. 

Despite its enthusiasm for the acquisition, Synchrony said that it is "not expected to have a material impact," on its financials. The deal is expected to close this quarter.

Without knowing how much Synchrony is paying for Allegro, it's tough to get a fix on whether this is a good deal for the company. But leaving financial questions aside, it feels like a very sensible move for it to push into new or underdeveloped customer segments.

Investors, however, might be seeing things differently. On Tuesday, they seemed to indicate their displeasure by trading Synchrony stock down by 3.4%, a far steeper decline than that of the S&P 500 index on the day.

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