“The Rise Fund, the global impact investing platform of leading alternative investment firm TPG, will invest $200 million in Airtel Mobile Commerce BV (“AMC BV”), a wholly owned subsidiary of Airtel Africa plc (the “Transaction”),” Airtel said in an exchange filing on Thursday.
“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,” it said.
Airtel Africa is further looking to raise minority investments as the company looks to sell a total 25% stake in AMC BV.
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.
“The transaction will close in two stages. $150 million will be invested at first close, once the transfer of sufficient mobile money operations and contracts into AMC BV has been completed, with $50 million to be invested at second close upon further transfers,” it said.
“The transaction is the latest step in the Group’s pursuit of strategic asset monetization and investment opportunities, and it is the aim of Airtel Africa to explore the potential listing of the mobile money business within four years,” Airtel said.
In case there is no initial public offering of shares of AMC BV within four years of the transactions, TPG will have an option to sell its stake at a consideration not exceeding $400 million.
“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. The proceeds from the Transaction will be used to reduce Group debt and invest in network and sales infrastructure in the respective operating countries,” it said.
