- MTN Group, Africa's largest wireless carrier, said that MasterCard has agreed to acquire a minority stake in its financial technology unit, which the company values at $5.2 billion. "The final investment agreements are expected to be signed very soon," MTN CEO Ralph Mobita said in a statement. Young people are increasingly using financial technology in Africa through their mobile phones to fill gaps in several services, including banking services. This opened up a lucrative and fast-growing space in the financial technology sector for wireless carriers.
- MTN's competitors, including Nairobi-based Airtel Africa and Safaricom, and South Africa's Vodacom Group, are all in various stages of transitioning from the primary uses of mobile phones, in terms of phone calls and text messages, to digitization, with the broad goal of separating businesses and monetizing them in the long term.
Why it matters
MTN has previously announced that it plans to raise 25 billion rand ($1.3 billion) from asset sales. The most recent operations include the sale and leaseback of mobile phone towers in South Africa and a plan to sell some of its assets in West Africa. It also has a share in the owner of the towers listed in New York, IHS Holding, which it may sell, although the decline in the shares of the towers company and the dispute with its management may delay any sale in the near term.