Airtel’s Mobile Money Receives $200M Investment from TPG’s The Rise Fund

Airtel Africa Plc has announced the signing of a major agreement with The Rise Fund, an impact investment platform owned by TPG Capital. The deal would see The Rise Fund invest the sum of $200 million in Airtel Mobile Commerce BV, the wholly-owned subsidiary of Airtel Africa Plc which will now actively serve as the holding company for the telco’s mobile money operations across 14 African countries.

A corporate action by Airtel Africa, which was seen by Business Elites Africa, explained that the deal valued Airtel Africa’s mobile money business at $2.65 billion, albeit on a cash and debt free basis.

Part of the agreement is that The Rise Fund will own minority stakes in Airtel Mobile Commerce BV once the deal is finalised. This still leaves Airtel Africa with majority stake-holding in the company.

The statement by the telco further explained that the deal is expected to reach first close within the next three to four months, after which The Rise Fund can be able to appoint a director to AMC BV’s Board as well as access certain customary information. In the meantime, however, the transaction is subject to all the necessary regulatory and stakeholders’ approvals.

Note that this deal was described as of Airtel Africa’s strategic asset monetisation and investment opportunities. Proceeds from the transaction are expected to help the leading telco to service its debts as well as invest in much-needed network and sales infrastructure across the African countries where it currently operates.

Meanwhile, Airtel Africa will continue to solicit other potential investors, even as plans are underway to list the mobile money business on a yet-to-be-named stock exchange within the next four years.

Airtel Africa’s Chief Executive Officer, Raghunath Mandava, commented on the development, stating that they are excited to welcome The Rise Fund as a partner.

“In line with our vision of enhancing financial inclusion, Airtel Africa offers a unique digital mobile financial services platform under the Airtel Money brand. In most of our markets there is limited access to traditional financial institutions, and little banking infrastructure, with less than half of the population having a bank account across sub-Saharan Africa. Our markets therefore afford substantial market potential for mobile money services to meet the needs of the tens of millions of customers in Africa who have little or no access to banking and financial services, and this demand is driving growth.

“With today’s announcement we are pleased to welcome The Rise Fund as an investor in our mobile money business and as a partner to help us realise the full potential from the substantial opportunity to bank the unbanked across Africa.” 

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