Mastercard Inc will invest $100 million in Airtel Africa’s mobile money operations valuing the business at $2.65 billion
Mastercard will hold a minority stake in Airtel Mobile Commerce, in line with Airtel Africa’s plan to monetize the mobile money business by selling up to a 25% stake in the unit, the company said.
The Mastercard deal was announced on Thursday, roughly two weeks after U.S-based global investing firm, TPG Rise Fund bought a $200 million chunk of Africa Airtel’s mobile money unit.
The two firms are no stranger to one another. In 2019, they inked a deal that enabled Airtel Africa’s 100 million subscribers in 14 nations access to Mastercard’s global network. (That partnership didn’t see any money exchange between Mastercard and Airtel Africa.)
Airtel Africa and Mastercard said today 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.”
More than half of the world’s mobile money services are located in Africa, according to a recent report by GSMA, making it a fertile market for investors. Mobile money services are defined as being accessible to people who do not have formal bank accounts.
Both TPG and Mastercard now have minority stakes in the company.
In addition to receiving investments from TPG’s Rise Fund and Mastercard, Airtel Africa has begun selling off some assets as well. Last week, the company sold 1,424 telecommunications towers in Madagascar and Malawi to Helios Towers for $119 million. Both Helios and Airtel Africa also agreed to trade tower assets in Chad and Gabon, although the details remain undisclosed.
Africa Airtel hopes the cash it makes off the sales will make it an attractive buy for potential stockholders. The company is considering plans to go public in four years.