Airtel Africa secures $200m investment for mobile money business from TPG

Airtel Africa has secured an investment of $200 million for its mobile money business – Airtel Mobile Commerce (AMC BV) from TPG’s global impact investing platform The Rise Fund.

Currently, Airtel Mobile Commerce is the holding firm for many of Airtel Africa’s mobile money operations. The company is now planned to own and operate the mobile money businesses across all of Airtel Africa’s 14 operating countries.

The deal values Airtel Africa’s mobile money business at $2.65 billion.

The Rise Fund will take a minority stake in Airtel Mobile Commerce, while Airtel Africa will own the remaining majority stake.

Yemi Lalude – Partner at TPG said: “Financial inclusion is a global issue that is most acute in Africa. Through Airtel Money, Airtel Africa has built a unique platform that is closing the gap between traditional financial institutions and the millions of unbanked Africans across the 14 countries where Airtel Africa operates.

“We look forward to working with Airtel Africa to enhance their mobile money services, broaden its use cases, and grow into new markets. With this investment in Airtel Africa’s mobile money operations, we are excited to expand The Rise Fund’s global fintech portfolio and continue to deepen our focus on improving financial inclusion in Africa and around the world.”

Airtel Africa plans to use the proceeds from the deal for cutting down its debt and invest in network and sales infrastructure in the respective operating nations.

The deal is subject to regulatory approvals and customary closing conditions.

Airtel Africa said that the deal is the latest step in its pursuit of strategic asset monetization and investment opportunities. The company said that it aims to explore the possible listing of the mobile money business within four years.

The Bharti Airtel subsidiary revealed that it is in talks with other potential investors regarding possible further minority investments into Airtel Money, up to a total of 25% stake in Airtel Mobile Commerce.

However, there can be no certainty that a deal will be executed or as to the final terms of any transactions, said Airtel Africa.

Raghunath Mandava – CEO of Airtel Africa said: “In line with our vision of enhancing financial inclusion, Airtel Africa offers a unique digital mobile financial services platform under the Airtel Money brand. In most of our markets there is limited access to traditional financial institutions, and little banking infrastructure, with less than half of the population having a bank account across sub-Saharan Africa.

“Our markets therefore afford substantial market potential for mobile money services to meet the needs of the tens of millions of customers in Africa who have little or no access to banking and financial services, and this demand is driving growth.”