TPG’s Rise Fund invested $200 million in Airtel Mobile Commerce BV, Airtel Africa’s mobile money business, just a few weeks ago, and now the telecom giant has announced a new deal. Global payments service provider, Mastercard invests $100 million in Airtel Africa for its mobile money business in the latest deal with the telecommunications giant. Airtel Africa will retain the majority stake in Airtel Mobile Commerce BV, with Mastercard holding a minority stake.
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As Mastercard invests $100 million in Airtel Africa, Airtel Mobile Commerce BV is currently valued at $2.65 billion and provides one of the continent’s largest financial services, including a mobile wallet, support for international money transfers, a loan, and a virtual credit card.
Mastercard invests $100 million in Airtel Africa to boost financial inclusion
Mastercard invests $100 million in Airtel Africa to boost growth in its mobile money business. However, the two companies have partnered together on various deals before where they worked together in 2019 to launch the Airtel Money Mastercard virtual card which would connect millions of Airtel Money customers to a global online market place, across multiple digital payment use cases and provide access to Mastercard’s global network of merchants.
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According to Tech Crunch, AMC BV is still valued at $2.65 billion on a cash and debt-free basis. This means TPG’s Rise Fund and Mastercard will own 7.55% and 3.775.% stake respectively upon the completion of their deals.
The CEO of Airtel Africa, Raghunath Mandava said, “With today’s announcement, we are pleased to welcome Mastercard as an investor in our mobile money business, joining The Rise Fund which we announced two weeks ago. This is a continuation of our strategy to increase the minority shareholding in our mobile money business with the further intention to list this business within four years.”
“We are significantly strengthening our existing strategic relationship with Mastercard to help us both realise the full potential from the substantial opportunity to improve financial inclusion across our countries of operation. The combination of our extensive customer base and distribution platforms and Mastercard’s products and services, innovation and know-how, mean we can together accelerate demand and drive growth in financial services for the benefit of all our customers and markets,” he explained further.
In addition to this investment where Mastercard invests $100 million in Airtel Africa, the two companies said they have “extended commercial agreements and signed a new commercial framework which will deepen their partnerships across numerous geographies and areas including card issuance, payment gateway, payment processing, merchant acceptance and remittance solutions, amongst others.”
Mastercard invests $100 million in Airtel Africa in a deal that will boost financial inclusion across different regions in Africa. Airtel Africa has also begun selling assets in addition to receiving investments from TPG’s Rise Fund and Mastercard. Helios Towers purchased 1,424 telecommunications towers in Madagascar and Malawi for $119 million last week. Helios and Airtel Africa have also agreed to swap tower assets in Chad and Gabon, though the specifics have not been revealed.
“As previously announced, Airtel Africa aims to continue to monetise its mobile money business with minority investments up to a total of 25% of the issued share capital of AMC BV, and to explore the potential listing of the mobile money business within four years. The proceeds from the Transaction will be used to reduce group debt and invest in network and sales infrastructure in the respective operating countries,”Airtel Africa said in a statement.
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