Mobile network operator Airtel Africa, which has Nigeria as its biggest market, is giving thought to launching a public shares sale for its mobile money arm, whose valuation exceeds $4 billion once the transaction is completed.
It has been in talks with possible advisors for a planned listing of the shares from the initial public offer on a stock exchange, yet to be decided, in any of London, the UAE and Europe, Bloomberg reported Wednesday, citing sources with the knowledge of the move.
Airtel Money needs to be separated from its parent as a standalone entity before it can attain the prestige of trading on a stock exchange.
Estimating the company at $4 billion compares with its valuation at $2.65 billion three years ago, when it sold minority stakes worth $200 million to San Francisco-based investment company The Rise Fund and $100 million to MasterCard.
That implies the valuation of Airtel Money, the group’s fastest-growing subsidiary, has expanded by more than half since 2021.
In Nigeria, the pace of growth for the mobile money business has been quickened by the launch of its SmartCash Payments Service Bank, which has witnessed dramatic adoption in its two years of operation, helped by concerted efforts by the central bank to drive cashless transactions.
Bloomberg stated that the sources said both the plan to list the mobile money division this year and the valuation amount are tentative.
The development comes weeks after Airtel Africa reported a 99.6 per cent fall in net profit in the nine months to December, after a $484 million foreign exchange, driven by sharp devaluations of the Nigerian naira, nearly plunged it into loss.
The company is currently in the middle of a share buyback to reacquire $100 million worth of its shares traded in the open market.
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