Airtel Africa, a leading provider of telecommunications and mobile money services, with a presence in 14 countries across Africa, has announced a major investment in its mobile money business.
The Rise Fund, the global impact investing platform of alternative investment firm TPG, will invest $200 million in Airtel Mobile Commerce BV, a wholly owned subsidiary of Airtel Africa plc.
AMC BV is currently the holding company for several of Airtel Africa’s mobile money operations. The aim is for AMC BV to own and operate the mobile money businesses across all of Airtel Africa’s 14 operating countries.
This transaction underlines the growing importance of mobile money in the African market. It values Airtel Africa’s mobile money business at $2.65 billion on a cash and debt-free basis. The Rise Fund will hold a minority stake in AMC BV upon completion of the transaction. Airtel Africa will continue to hold the remaining majority stake.
Airtel Africa describes the transaction as the latest step in the group’s pursuit of strategic asset monetization and investment opportunities. It is the aim of Airtel Africa to explore the potential listing of the mobile money business within four years. Airtel Africa is in discussions with other potential investors in relation to possible further minority investments into Airtel Money.
The proceeds from the transaction will be used to reduce the company’s debt and to invest in network and sales infrastructure in the countries in which Airtel Africa operates.
Raghunath Mandava, CEO of Airtel Africa, commented: “With today’s announcement we are pleased to welcome The Rise Fund as an investor in our mobile money business and as a partner to help us realise the full potential from the substantial opportunity to bank the unbanked across Africa.”
