Airtel Africa announced the signing of an agreement under which The Rise Fund, the global impact investing platform of TPG, will invest USD 200 million in Airtel Mobile Commerce. AMC is the holding company for several of Airtel Africa’s mobile money operations and is now intended to own and operate the mobile money businesses across all of Airtel Africa’s fourteen operating countries, Airtel said.
The transaction values Airtel Africa’s mobile money business at USD 2.65 billion on a cash- and debt-free basis. The Rise Fund will hold a minority stake in AMC, with Airtel Africa continuing to hold the remaining majority stake.
The sale is the latest step in the group’s pursuit of strategic asset monetization and investment opportunities. Airtel said the aim is to explore the potential listing of the mobile money business within four years.
The group is in discussions with other potential investors in relation to possible further minority investments into Airtel Money, up to a total of 25 percent of the issued share capital of AMC. The proceeds from the transaction will be used to reduce debt and invest in network and sales infrastructure in the respective operating countries.
Operating under the Airtel Money brand, Airtel Africa’s mobile money services is a leading digital mobile financial services platform catering to a large addressable market in Africa and includes mobile wallet deposit and withdrawals, merchant and commercial payments, benefits transfers, loans and savings, virtual credit card and international money transfers. It counted 21.5 million users at the end of December, up 29 percent from a year earlier.
The sale is expected to reach first close over the next three to four months. From first close The Rise Fund will be entitled to appoint a director to the board of AMC and to certain customary information and minority protection rights.
