Mastercard has completed the acquisition of a minority investment in MoMo, the financial technology unit of MTN, six months after the payment company first revealed its intentions to do so.
According to MTN, it and Mastercard have inked a “definitive agreement” for a minority investment of up to $200 million (R3.8 billion) at a cash and debt-free valuation of $5.2 billion (R99 billion) in MTN Group Fintech.
The telecom company said that the deal, which was first disclosed on August 14, 2023, is subject to customary closing conditions and is not classified under the standards for listings on the Johannesburg Stock Exchange (JSE).
Ralph Mupita, president and CEO of MTN Group, recently disclosed that the corporation was considering selling around a thirty percent share in the fintech industry.
The mobile money platform MoMo, insurance products, airtime financing, e-commerce, and network services are all part of MTN’s fintech stack.
Africa’s largest mobile operator, MTN, reported its interim financial results for the six months ended June 2023, showing that its fintech business has been thriving. Revenue increased by 21.7% year over year, mostly because of growth in the wallet (+20.7%), payment and e-commerce (+54.9%), and remittance (+78.9%) industries.
The Mastercard transaction occurred as MTN Group was getting ready to split its financial services section and is growing its fintech business to put the telecoms company on firm ground.
The company claims that these partnerships assist the ongoing expansion of infrastructure and technological advancements that promote financial inclusion throughout the African continent, complementing the telecom group’s and Mastercard’s bigger business relationship.
“The payments and remittance services provided by our fintech business are accelerating thanks in large part to this commercial relationship.”
According to the corporation, “MTN will continue to explore opportunities for other value-enhancing partnerships and investments with strategic partners and long-term investors, subject to market conditions.”
In terms of subscribers and market share, the telecom company leads the Nigerian market.
According to data from the Nigerian Communications Commission (NCC), which The Guardian checked, MTN had 85.9 million customers as of August 2023.
As of 2023, MTN had approximately 290 million subscribers and operated in 21 countries, including Afghanistan, Iran, Syria, Cyprus, Cameroon, Côte d’Ivoire, Ghana, Guinea Bissau, Liberia, Benin, Nigeria, Rwanda, South Africa, Sudan, South Sudan, Swaziland, Uganda, Yemen, Zambia, and so on.
