MTN Group is taking bold steps to transform its fast-growing fintech division, with plans to spin off its operations in Nigeria, Ghana, and Uganda during the first half of 2025. This move, announced by CEO Ralph Mupita in an interview with Bloomberg, is a critical milestone in MTN’s strategy to deepen its partnership with Mastercard and unlock more value from its financial services arm.
The spin-off will pave the way for Mastercard to acquire a minority interest in MTN’s fintech businesses, following a deal first unveiled in 2023. According to Mupita, while Uganda and Ghana are well on track with the separation process, Nigeria’s more intricate regulatory landscape is adding extra layers of complexity.
“There are additional regulatory processes we need to navigate in Nigeria,” Mupita remarked, while reaffirming the company’s commitment to completing the restructure across all three markets.
Shifting Strategy and Operational Efficiency
The decision to carve out the fintech business is part of MTN’s broader efforts to sharpen its focus on high-growth verticals. The company is also eyeing network-sharing partnerships—a model popularized in Europe—to lower infrastructure costs and enhance service delivery.
This dual-pronged strategy reflects MTN’s pivot toward maximizing profitability while adapting to competitive pressures and regulatory dynamics in its key African markets.
Inside the Mastercard Deal
The partnership with Mastercard values MTN’s fintech arm at approximately $5.2 billion. Under the terms of the agreement, Mastercard will inject up to $200 million for a minority stake, reinforcing the payment giant’s confidence in MTN’s ability to scale its fintech services, particularly in payments and remittances.
In 2023, MTN Group announced that it had reached commercial agreements with Mastercard designed to fast-track the growth of its fintech platform. Additionally, the two companies signed a memorandum of understanding, outlining Mastercard’s intention to invest based on an enterprise valuation of $5.2 billion for MTN’s fintech business on a debt- and cash-free basis.
MTN has indicated that the signing of definitive investment agreements is imminent, with due diligence and standard regulatory clearances expected to conclude soon.
Financial Headwinds and Dividend Plans
The spin-off comes on the heels of MTN’s recently published financial results, which showed a full-year net loss of 9.59 billion rand for 2024—well above market expectations, which had forecast a loss of 3.87 billion rand. Despite this, MTN is signaling optimism about its financial outlook.
The telecoms giant declared a dividend of 3.45 rand per share for 2024 and has committed to increasing this payout to a minimum of 3.70 rand per share in the current financial year, a move aimed at reassuring investors and underscoring its confidence in long-term growth prospects.
What This Means for MTN
As Africa’s largest telecommunications provider by revenue, MTN’s restructuring and strategic partnership with Mastercard could significantly bolster its fintech aspirations across the continent. The company is betting on the continued expansion of digital financial services, particularly in emerging markets where demand for mobile payments and cross-border remittances is growing rapidly.
In the months ahead, stakeholders will be watching closely as MTN navigates Nigeria’s regulatory environment and finalizes its deal with Mastercard—a partnership poised to reshape Africa’s fintech landscape.
