MTN Group has announced a strategic initiative to acquire a 60% stake in two of MTN Nigeria’s key Fintech platforms: MoMo Payment Service Bank Limited (MoMo PSB) and Y’ello Digital Financial Services (YDFS) Limited. This significant transaction is projected to be valued at N95.5 billion, with MTN Group committing a substantial investment of N152.06 billion into these fintech subsidiaries. The explanatory note, filed with the Nigerian Exchange (NGX), details that this move is crucial for making a considerable financial investment in the fintech ventures and aligns perfectly with the group’s overarching Ambition 2030 strategy, which aims to establish MTN as Africa’s premier Connectivity, Fintech, and Digital Infrastructure platform business.

Upon the anticipated completion of the acquisition by December 31, 2026, MTN Group, operating through its MTN Group Fintech entity, will hold a 60% ownership in both MoMo PSB and YDFS, with MTN Nigeria retaining the remaining 40% stake. The N152.06 billion investment will be executed through a hybrid approach, involving both a primary injection of capital directly into the fintech subsidiaries and a secondary acquisition of shares from MTN Nigeria. Post-acquisition, both MTN Group and MTN Nigeria are mandated to transfer their respective shares in these fintech subsidiaries into a newly established Holding Company, which will be registered with the Central Bank of Nigeria.

The rationale behind this deal stems from the necessity to streamline MTN Nigeria’s operational affairs. Currently, both MoMo Payment Service Bank Limited and Y’ello Digital Financial Services Limited are operating at a loss, which significantly impacts MTN Nigeria’s financial performance. This structural separation is designed to grant MTN Group greater control over the operations of these fintech subsidiaries, enabling a more direct and substantial injection of funds. MTN Nigeria emphasized that the deal will provide essential funding and restructure the ownership and operating model of the Fintech Subsidiaries to accelerate growth and effectively capitalize on emerging opportunities within the rapidly evolving digital financial services market.

A critical outcome of this structural separation is that the losses incurred by the fintech subsidiaries will no longer be consolidated into MTN Nigeria’s financial statements, which is expected to considerably enhance the telco’s overall financial performance. Furthermore, with MTN Group assuming primary responsibility for the fintechs’ capital expenditure (CAPEX), MTN Nigeria will no longer need to commit as much funding to support these ventures. This reallocation of capital will enable MTN Nigeria to further strengthen its balance sheet and strategically direct its financial resources towards driving growth in its core connectivity platform, thereby improving or at least stabilizing its ability to pay dividends.

While the arrangements are still in preliminary stages, MTN Nigeria is scheduled to make a formal presentation of this deal to its shareholders during its Annual General Meeting on April 30, 2026. The entire transaction remains contingent upon receiving the necessary approvals from Nigerian regulatory authorities.