Target Reaches Agreement With Visa Over Data Breach

Target Corp (NYSE:TGT) said it has reached an agreement with Visa Inc (NYSE:V) card issuers to reimburse up to $67 million in costs related to a data breach at the retailer in 2013, according to a source familiar with the matter.

The agreement comes three months after a proposed $19 million settlement between Target and Mastercard Inc (NYSE:MA) fell through as not enough banks accepted the deal.

The deal required the approval of banks that issued at least 90 percent of the MasterCard accounts.

The breach during the holiday shopping season compromised at least 40 million credit cards and may have resulted in the theft of personal information from as many as 110 million people.

Target's unprecedented data breach was followed by an attack on Home Depot Inc (NYSE:HD) which revealed theft of some 56 million payment cards in September last year.

More recently, office supplies retailer Staples Inc (NASDAQ:SPLS) said about 1.16 million payment may have been affected by a data breach it had announced in October.

Target has agreed to fund up to $67 million pretax in payments to Visa and its issuers, depending on the extent of eligible issuer acceptance, according to the source.

Target said the agreement with Visa was based on a condition that a subset of Visa card issuers entered into direct settlements with Target and Visa.

"Visa has worked to help Target reach a resolution for the expenses incurred as result of the 2013 compromise.... This agreement attempts to put this event behind us," Visa said.

The Wall Street Journal earlier reported the agreement, citing people familiar with the matter. (http://on.wsj.com/1K3REzC)

Target has incurred $162 million in net expenses related to the breach as of Jan. 31.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Don Sebastian)