The Rise Fund will invest $200 million in Airtel Mobile Commerce (AMC) BV, the mobile money business of Airtel’s Africa unit, the company has announced.
Airtel Africa, a leading provider of telecommunications and mobile money services, with a presence in 14 countries across Africa announced the signing of an agreement under which The Rise Fund, the global impact investing platform of leading alternative investment firm TPG will value the company at $2.65 billion on a cash and debt-free basis whereas proceeds from the stake sale will be used to slash Airtel’s debt, and invest in developing network and infrastructure across 14 countries in the region.
“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 fourteen operating countries. 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,”Airtel Africa said in a statement.
“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. “
The company described the transaction as the latest step in their pursuit of strategic asset monetization and investment opportunities with an aim of exploring the potential of listing of the mobile money business within four years.
“The Group is in discussions with other potential investors in relation to possible further minority investments into Airtel Money, up to a total of 25% of the issued share capital of AMC BV. There can be no certainty that a transaction will be concluded or as to the final terms of any transactions. The proceeds from the Transaction will be used to reduce group debt and invest in network and sales infrastructure in the respective operating countries.”