{"id":6696,"date":"2021-03-20T18:31:56","date_gmt":"2021-03-20T18:31:56","guid":{"rendered":"https:\/\/www.africa-press.net\/uganda\/?p=6696"},"modified":"2021-03-20T16:43:07","modified_gmt":"2021-03-20T16:43:07","slug":"airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b","title":{"rendered":"Airtel sells mobile money service stake to PE firm for Shs730b"},"content":{"rendered":"

Africa-Press<\/a> – Uganda<\/a>. <\/strong><\/span>TPG has also been given the option to sell its stake back to Airtel in the future at a maximum price of $400 million or double what it is investing now.<\/p>\n

Airtel Africa is set to sell an undisclosed minority stake in its Pan-African mobile money business to private equity firm TPG for $200 million (about Shs730 billion), underlining the huge value of mobile financial service platforms.<\/p>\n

The multinational announced the transaction Thursday through the London Stock Exchange where it is listed.<\/p>\n

The record-breaking deal values Airtel Money, available in Share sale to private equity comes amid struggle to cut M-Pesa dominance in the Kenyan market 14 African countries including Kenya, Malawi and Uganda, at $2.65 billion (about Shs9.7 trillion).<\/p>\n

TPG is investing in Airtel Money through its investment vehicle The Arise Fund.<\/p>\n

\u201cWith today\u2019s 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,\u201d Raghunath Mandava, CEO of Airtel Africa, said in a statement Thursday.<\/p>\n

The transaction indicates that the rival M-Pesa platform, available in Kenya and five other African markets such as Tanzania and Mozambique, could be valued even higher.<\/p>\n

Airtel Money generated revenues of $548 million (Shs2 trillion) in the African markets in the six months ended September 2020 when active users of the platform stood at 21 million.<\/p>\n

M-Pesa had 55 million customers and its total revenue, including Kenya, over the same period stood at R8 billion.<\/p>\n

Airtel says the cash raised from the deal with TPG, expected to be completed in four months, will be used to reduce debt and invest in network and sales infrastructure in the respective operating countries.<\/p>\n

The Arise Fund is investing in Airtel Money in two stages that will see it pay an initial $150 million and later $50 million.<\/p>\n

The fund will buy the undisclosed stake in Airtel Mobile Commerce BV (AMC BV) \u2013 the company that will own and operate the mobile money business across all of the multinational\u2019s 14 markets in Africa.<\/p>\n

TPG has also been given the option to sell its stake back to Airtel in the future at a maximum price of $400 million or double what it is investing now.<\/p>\n

\u201cThe transaction is the latest step in the group\u2019s pursuit of strategic asset monetisation and investment opportunities, and it is the aim of Airtel Africa to explore the potential listing of the mobile money business within four years,\u201d the telecoms operator said in a statement.<\/p>\n

\u201cThe 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 BV.\u201d<\/p>\n

The sale of more shares in the mobile money platform will boost the telco\u2019s war chest and raise competition in the lucrative African mobile financial services business.<\/p>\n

Both Airtel, Safaricom and South Africa\u2019s Vodacom Group see mobile money as presenting growth and diversification opportunity and have invested billions of shillings to develop new offshoots of their platforms\u2019 core offerings of cash transfers and payments.<\/p>\n

\u201cMobile money continues to be one of the Airtel Africa\u2019s fastest-growing business segments, delivering revenue growth of 30.4 percent in first half of the year [ended September]. It is an increasingly important part of our business and currently accounts for 10.3 percent of our total revenue in constant currency,\u201d the multinational said.<\/p>\n

\u201cWe aim to drive the uptake of Airtel Money services in all our markets, harnessing the ability of a profitable mobile money business model to enhance financial inclusion in some of the most \u2018unbanked\u2019 populations in the world.\u201d<\/p>\n

Airtel added that the low uptake of traditional banking services continues to be the main driver of demand for mobile money services.<\/p>\n

The platform currently offers mobile wallet deposit and withdrawals, merchant and commercial payments, benefits transfers, loans and savings, virtual credit card and international money transfers.<\/p>\n

The multinational has sought to expand the subscriber base and use of its mobile money platform through partnerships with multiple financial service firms.<\/p>\n

It has, for instance, signed agreements with cash remittance companies MoneyGram, Mukuru and WorldRemit.<\/p>\n

The telecoms operator also plans to introduce new banking and remittance services in partnership with London-based lender Standard Chartered Plc, which has subsidiaries operating in 16 African markets.<\/p>\n

Airtel Money has struggled in the Kenyan market where it has less than 400,000 active customers against M-Pesa\u2019s 27 million, according to the Communications Authority of Kenya (CA). The service is, however, more successful in other African markets.<\/p>\n

Vodacom and Safaricom, which jointly own the M-Pesa platform, have similar plans to expand its customer base outside Kenya, including through rollout of new services and partnerships.<\/p>\n

M-Pesa launched as a person-to-person cash transfer service but has grown into payments and credit. The owners of the service are keen to grow the uptake of additional services such as investing and insurance.<\/p>\n

\u201cM-Pesa offers a unique opportunity to extend our reach further into financial services,\u201d Vodafone Group Plc, the parent company of Safaricom and Vodacom, said in a past statement.<\/p>\n

\u201cThrough a strategic technology partnership with Alipay, we are developing a new \u2018super app\u2019 that will offer customers a unified suite of financial services, entertainment, shopping, merchant services and direct marketing.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Uganda. TPG has also been given the option to sell its stake back to Airtel in the future at a maximum price of $400 million or double what it is investing now. Airtel Africa is set to sell an undisclosed minority stake in its Pan-African mobile money business to private equity firm TPG […]<\/p>\n","protected":false},"author":84,"featured_media":6695,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5,8],"tags":[233,240,234],"class_list":["post-6696","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","category-homepage-english","tag-africa-press","tag-africa-press-uganda","tag-uganda"],"yoast_head":"\nAirtel sells mobile money service stake to PE firm for Shs730b - Uganda<\/title>\n<meta name=\"description\" content=\"TPG has also been given the option to sell its stake back to Airtel in the future at a maximum price of $400 million or ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Airtel sells mobile money service stake to PE firm for Shs730b\" \/>\n<meta property=\"og:description\" content=\"TPG has also been given the option to sell its stake back to Airtel in the future at a maximum price of $400 million or ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\" \/>\n<meta property=\"og:site_name\" content=\"Uganda\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2021-03-20T18:31:56+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2021\/03\/img-605626064ab7c.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"720\" \/>\n\t<meta property=\"og:image:height\" content=\"480\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Airtel sells mobile money service stake to PE firm for Shs730b\",\"datePublished\":\"2021-03-20T18:31:56+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\"},\"wordCount\":890,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2021\/03\/img-605626064ab7c.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Uganda\",\"uganda\"],\"articleSection\":[\"all news\",\"economy\",\"homepage-english\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\",\"url\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/airtel-sells-mobile-money-service-stake-to-pe-firm-for-shs730b\",\"name\":\"Airtel sells mobile money service stake to PE firm for Shs730b - 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