Mastercard has successfully finalized the acquisition of a minority stake in the fintech arm of MTN Group, a leading mobile operator.

According to MTN, definitive agreements have been signed, enabling Mastercard to make a minority investment of up to $200 million in MTN Group Fintech. This strategic move values MTN Group Fintech at $5.2 billion on a cash and debt-free basis. The transaction, originally announced on August 14, 2023, is pending customary closing conditions and falls outside the categorization stipulated by JSE listings requirements.

Ralph Mupita, MTN Group's President and CEO, had previously expressed the company's intention to divest approximately 30% of its fintech business. MTN's fintech portfolio encompasses various services, including the MoMo mobile money platform, insurance products, airtime lending, e-commerce, and network services.

MTN reported robust performance in its fintech sector, with a remarkable 21.7% year-over-year revenue growth. This growth was primarily attributed to the flourishing wallet (+20.7%), payment and e-commerce (+54.9%), and remittance (+78.9%) industries.

The Mastercard investment aligns with MTN Group's broader strategy of expanding its fintech business, reinforcing its position as it prepares to separate its financial services division. The agreements between Mastercard and MTN aim to strengthen the commercial relationship between the two entities, fostering the development of technology and infrastructure to promote financial inclusion across the African continent.

MTN highlighted that this collaboration with Mastercard serves as an important catalyst for accelerating the growth of its fintech business, particularly in the payments and remittance services sector. Looking ahead, MTN remains open to exploring additional opportunities for value-enhancing partnerships and investments with strategic partners and long-term investors, contingent on market conditions.

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