Airtel Africa Plc has signed an agreement with The Rise Fund under which The Rise Fund will invest $200 million in Airtel Mobile Commerce BV (AMC BV), a wholly owned subsidiary of Airtel Africa Plc. AMC BV is currently the holding company for several of Airtel Africa’s mobile money operations; and is now intended to own and operate the mobile money businesses across all of Airtel Africa’s 14 operating countries. Airtel Africa also said today that it’s considering listing the mobile money business as a separate business within the next four years.
Airtel Africa Plc is listed on the Nigerian Stock Exchange (NSE) and Nigeria is the major market for the leading provider of telecommunications and mobile money services, which has presence in 14 countries across Africa.
The Rise Fund is the global impact investing platform of leading alternative investment firm, TPG. The transaction values Airtel Africa’s mobile money business at $2.65 billion on a cash and debt free basis. The Rise Fund will hold a minority stake in AMC BV upon completion of the transaction, with Airtel Africa continuing to hold the remaining majority stake.
The transaction is subject to customary closing conditions including necessary regulatory filings and approvals, as necessary, and the inclusion of specified mobile money business assets and contracts into AMC BV.
A newly incorporated investment vehicle of The Rise Fund will invest $200 million through a secondary purchase of shares in AMC BV from Airtel Africa. The transaction will close in two stages-$150 million will be invested at first close, once the transfer of sufficient mobile money operations and contracts into AMC BV has been completed, with $50 million to be invested at second close upon further transfers.