Mastercard signs MoU to buy minority stake in MTN’s $5.2bn fintech business
Payments giant Mastercard has signed a Memorandum of Understanding (MoU) to buy a minority stake in African mobile network operator MTN Group’s fintech business.
Mastercard to buy minority stake in MTN’s $5.2bn fintech business
According to the MoU, Mastercard will become a minority investor in MTN Group Fintech, valuing the business at about $5.2 billion, on a cash and debt-free basis. The company did not disclose the amount to be invested.
In its H1 2023 report, MTN Group says it underwent a process to identify and introduce strategic minority investors to MTN Group Fintech, and signed commercial agreements with Mastercard to accelerate growth and profitability of its fintech services, including payments, remittance and technology infrastructure development.
“Signing of the definitive investment agreements is expected to occur in the very near term as we approach finalisation of customary due diligence. The closing of the investment will be subject to customary closing conditions,” MTN stated in the report.
For MTN’s fintech division, H1 2023 saw its revenue grow by 21.7% year-on-year, driven by growth in its wallet, payments, e-commerce and remittance verticals, with active users standing at 60.5 million.
MTN says its partnership with Mastercard will enable its consumers to pay globally and businesses to digitise their payments and accept payments beyond users.
“This will enable Group Fintech customers to participate in the global economy,” MTN Group says. “These commercial agreements are another milestone in MTN’s strategic intent of leading digital solutions for Africa’s progress and driving financial inclusion across the continent.”
