Mastercard will invest $100 million in Airtel Mobile Commerce (AMC) BV, a wholly owned subsidiary of Airtel Africa, the company announced on Thursday.
Mastercard will own a minority stake of 3.75 percent in AMC BV after the transaction closes, while Airtel Africa will retain the majority stake.
Airtel Africa’s mobile money sector is estimated at $2.65 billion on a cash and debt-free basis, according to a statement.
AMC BV is the holding company for most of Airtel Africa’s mobile money activities, with the aim of owning and running mobile money companies in all of Airtel Africa’s fourteen operating countries.
“Alongside the investment, the Group and Mastercard 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,” it added.
The transaction’s proceeds will be used to reduce the Group’s debt and invest in network and sales infrastructure in each of its operating countries. The deal is subject to customary closing conditions, including regulatory filings and approvals, as well as the transfer of stated mobile money business assets and contracts into AMC BV, according to the company.
Educator, writer and legal researcher at Alafarika for Studies and Consultancy.