MTN to put $ 6 billion value on mobile money unit

As telcoms giants dispose non- core assets

MTN Group Chief Executive Officer, Ralph Mupita, has said that the telecommunications firm targets a valuation of between $ 5 billion and $ 6 billion of its mobile money arm, as it prepares for the sale or listing of a minority stake.

Mupita, who disclosed this in an interview with Financial Times, outlined basic details about the future of its mobile financial service, which is set to be separated as part of a strategy to help it cash in on various assets unveiled in March.

The company, which operates across several of Africa’s largest markets, has long prized its mobile money offer with the segment often cited as one of the major growth areas in the business.

Mupita said MTN planned to structurally separate the business within the next year.

Funds raised from its money and infrastructure assets will go into cutting the company’s debt stock, adding to the disposal of several parts of the business’ non- core assets in the last two years.

MTN is also in the process of selling off non- core assets in the Middle East as it plans to focus its efforts on Africa.

The operator is not alone in seeking to raise money on the strength of its mobile financial services business. Its regional rival, Airtel Africa, is selling two separate stakes in its equivalent to investment company TPG and Mastercard.

Bloomberg, which referred to Global System for Mobile telecommunications Association ( GSMA), which puts the region’s transaction values at $ 490 billion, reported that MTN and its counterpart Safaricom of Kenya were planning to bid for an Ethiopian operating license, although it’s uncertain that mobile- money services could be rolled out with the initial licenses in the country.

Nigeria has been laggard in rolling out mobilemoney services, providing some provisional licenses.