MTN has valued its mobile money business fondly called MoMo at about $6 billion as it prepares to sell or list a minority stake to draw global investors, according to a report by the Financial Times.
This was disclosed by the company’s Chief Executive Officer, Mr Ralph Mupita, that the business should be worth at least $5 billion or $6 billion and should be listed within the next year.
The South African telecommunications company has 280 million global subscribers and the mobile money arm accounts for more than 15 per cent (46 million).
The plan, which was initially unveiled in March, is part of a strategy shift to refocus its business and cut $3 billion of net debt.
He was quoted as saying, “We think the best way to run these businesses is to structurally separate them.”
Mr Mupita further said that the move would unlock the value hidden in MTN’s $11 billion market capitalisation.
The group wants to tap into growing investor interest in the mobile money businesses built by African telecoms in the past decade that allow phone subscribers to send or receive money outside banks and increasingly sell ancillary services such as microinsurance.
Mr Mupita also revealed that the group’s financial services interests also include an insurance joint venture with over 10 million customers.
