Airtel Africa sells 25% stake in mobile money arm to Mastercard for $100m

Written by Ruby Hinchliffe
7th April 2021

Airtel Africa, a London-listed telecom firm with a network spanning 14 African countries, has landed a $100 million investment from Mastercard for its mobile money unit.

The investment sees the sale of a 25% stake in Airtel Mobile Commerce (AMC BV) to the card issuing giant. Airtel Africa will continue to hold a majority stake.

Airtel Africa hopes to list the mobile money business as a separate entity

Mastercard says it has also extended its commercial agreements with Airtel Africa around card issuance, merchant acceptance, remittances, as well as payment gateways and processing.

In 2019, Mastercard and Airtel Africa entered into a partnership which saw the latter’s 100 million subscribers gain access to Mastercard’s global network. The deal did not see any money exchange hands.

The latest stake sale arrives less than a month after The Rise Fund – TPG’s global impact investing platform – invested $200 million into the same part of Airtel Africa’s business.

Whilst TPG’s Rise Fund will own 7.55% of Airtel Africa, Mastercard will own a lesser 3.775.% stake.

Monetisation and an eventual listing

These multi-million capital injections take the mobile money arm’s valuation to $2.65 billion.

Last month, Airtel Africa also sold 1,424 telecom towers in Madagascar and Malawi to Helios Towers for $119 million.

All these sales contribute towards the company’s aim “to monetise its mobile money business”. It wants to do this with minority investments up to 25% of the issued share capital of AMC BV.

It will also use the new funds to reduce the company’s debt and invest in network and sales infrastructure. Within the next four years, Airtel Africa hopes to list the mobile money business as a separate entity.

The group is a subsidiary of Bharti Airtel, an Indian multinational telecom based out of New Delhi.

As well as mobile money services, the African subsidiary also offers mobile voice and data services.

Founded in 2010, Airtel Africa covers Kenya, Nigeria, Uganda, Madagascar, Zambia, Rwanda, Malawi, Chad, Niger, Gabon, Congo B, DRC, Seychelles, and Tanzania.