Sylvia Duruson
In a strategic move to capitalize on the growth potential of its mobile money services, Airtel Africa has announced plans to take its mobile money unit public through an initial public offering (IPO) in 2025. This decision comes as the telecom giant aims to expand its mobile money footprint across more African countries, building on its current presence in 14 nations.
Olusegun Ogunsanya, the Chief Executive Officer of Airtel Africa, confirmed the IPO plans, stating, “We will list next year. We will continue to bring additional countries into the envelope. We are still a year from that IPO.” However, details regarding the preferred stock exchange for the listing were not disclosed.
Airtel Money, the company’s mobile money arm, has emerged as its fastest-growing segment, with a potential valuation exceeding $4 billion. This strong performance contrasts with Airtel Africa’s recently released financial results, which were significantly impacted by challenging macroeconomic conditions that affected profitability for a significant part of the financial year.
Despite the overall financial headwinds, which contributed to an $89 million loss after tax, a sharp decline from a $750 million profit recorded at the end of the previous year, Airtel’s mobile money unit and data revenues stood out as bright spots.
The mobile money unit demonstrated robust growth, with its transaction value increasing by an impressive 38.2% in constant currency, reaching an annual transaction value of over $112 billion in reported currency. Year-over-year, Airtel’s mobile money customer base grew by 20% to 38 million, driven by a continued strong performance in East Africa and Francophone Africa.
Airtel’s planned mobile money IPO aligns with a broader trend of investment in African mobile money providers. Recently, Mastercard acquired a minority stake in MTN’s mobile money arm, following its $100 million investment in Airtel Money two years ago.
According to Ogunsanya, Airtel Mobile Money is strongest in six key markets, four of which are in East Africa: Zambia, Uganda, Tanzania, and Malawi. The remaining two are Gabon and the Democratic Republic of Congo in the Francophone markets.
Part of Airtel’s winning strategy in these markets includes first-mover advantages, strategic infrastructure, and an extensive distribution network. Ogunsanya highlighted that Airtel leads the mobile money markets in Zambia and Malawi, while the competition is relatively low in Uganda and Tanzania, with only two and three operators, respectively.
“We were the first to deploy ATMs, giving us a significant head start,” Ogunsanya explained. “Our network boasts 29,000 exclusive mobile money branches, with a well-established system. We have been effective in leveraging our infrastructure to our advantage.”
As Airtel Africa prepares for its mobile money unit’s public listing, the company is poised to capitalize on the growing demand for mobile financial services across the African continent.
