QIA to invest $200m in Airtel Africa’s mobile money business

Airtel Africa announced on Friday the signing of an agreement under which Qatar Holding LLC, an affiliate of the Qatar Investment Authority, will invest $200 million in Airtel Mobile Commerce BV, a subsidiary of Airtel Africa.

AMC BV, the holding company for several of Airtel Africa’s mobile money operations, is intended to own and operate the mobile money businesses across all of Airtel Africa’s 14 operating countries.

The transaction values Airtel Africa’s mobile money business at $2.65 billion on a cash and debt-free basis, according to a statement.

The telecommunication company said QIA would hold a minority stake in AMC BV upon completion of the transaction (alongside other minority investors), with Airtel Africa continuing to hold the majority stake.

“The transaction is subject to customary closing conditions,” it said.

The company described the transaction as a continuation of its pursuit of strategic asset monetisation and investment opportunities, saying it aimed to explore the potential listing of the mobile money business within four years.

It said the proceeds from the transaction would be used to reduce group debt and invest in network and sales infrastructure in the respective operating countries.

The statement said QIA would invest $200 million through a secondary purchase of shares in AMC BV from Airtel Africa.

It said, “The transaction will close in two stages: $150 million will be invested at first close, subject to customary closing conditions, including necessary regulatory filings, with $50 million to be invested at second close once further transfers of certain mobile money operations and contracts into the AMC BV perimeter have been completed.

“The transaction first close is expected in August. From first close, QIA will be entitled to appoint a director to the board of AMC BV and to certain customary information and minority protection rights.”

The Chief Executive Officer of Airtel Africa, Raghunath Mandava, said the company was pleased to welcome QIA as a prospective investor in its mobile money business, joining both Mastercard and TPG’s The Rise Fund as a further partner “to help realise the full potential from the substantial opportunity to bank the unbanked across Africa”.

The CEO of QIA, Mansoor bin Ebrahim Al-Mahmoud, said, “We are delighted to build on our support of Airtel Africa in promoting financial inclusion to the large and growing population of Sub-Saharan Africa.

“Airtel Money plays a critical role in facilitating economic activity, including for customers without access to traditional financial services. We firmly believe in its mission to expand these efforts over the coming years.”

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