Telecommunications company Airtel Africa on Thursday announced an agreement with TPG investing platform the Rise Fund, which would see the fund invest $200m in its wholly-owned subsidiary Airtel Mobile Commerce.
In a statement, Airtel Africa said TPG’s platform The Rise Fund will take a minority stake in its Airtel Mobile Commerce (AMC) unit, the holding company for several of its mobile money operations, with the operator retaining majority ownership.
It also detailed plans to bring all of its mobile money operations in 14 countries under AMC’s control.
In February, London-listed telecom, Airtel Africa, said it was looking to sell a minority stake in its mobile money business in a bid to raise cash and sell off some assets.
The firm seems to have found an investor as it announced that The Rise Fund, the global impact investing platform of investment firm TPG, will invest $200 million in its mobile money arm.
The investment will see the mobile money business — Airtel Mobile Commerce BV (AMC BV) — valued at $2.65 billion. AMC BV is an Airtel Africa subsidiary and the holding company for several of Airtel Africa’s mobile money operations across 14 African countries, including Kenya, Uganda, and Nigeria.
The TPG transaction will value Airtel Africa’s mobile money business at $2.65 billion, with the investment set to be completed in two stages, the first of which is expected to close within the next four months.
Airtel Africa said proceeds will go towards cutting its debt, and financing network and sales infrastructure across its operations.
CEO Raghunath Mandava added the move will help the company “realise the full potential from the substantial opportunity to bank the unbanked across Africa”.
Airtel Africa also said it was in talks with other potential investors regarding options to sell more minority stakes of its mobile money operations.
