Toronto-Dominion bank will pay at least $5.9 billion to take over the credit card portfolio of U.S. retailer Target Corp., which will soon launch dozens of Canadian locations.

TD announced a seven-year agreement that will see the Toronto-based bank acquire the retailer's Visa and private label card portfolio by paying the total amount of loans outstanding on those cards — $5.9 billion US.

Target currently has about 5 million account holders. "Our agreement with Target will significantly expand our presence in the North American credit card business," TD Bank president Ed Clark said in a release.

Latest of many credit deals

Pending regulatory approval and other closing conditions, TD expects the deal to close in the first half of 2013.

The move is the latest attempt by TD at beefing up its retail credit offerings. In 2010, TD closed a deal to take over automaker Chrysler's retail credit card business for $6.3 billion. It also recently bought Bank of America's credit card assets in Canada for more than $8 billion.

Although the deal covers just U.S. accounts, Minneapolis-based Target plans to open 124 stores across Canada starting in March and April 2013, so there could be growth opportunities for new customers on TD's home soil.

Under the terms of the deal, Target will maintain a share in any future profits to be had from the portfolio.

"This transaction achieves all of Target's strategic and financial goals for a portfolio sale," said the retailer's president and CEO Gregg Steinhafel.