MTN taps JPMorgan to separate fintech unit

accreditation
0:00
play article
Subscribers can listen to this article
Supplied

MTN, Africa’s largest phone company, is working with advisers at JPMorgan Chase & Co. on the planned separation of its financial technology business, people with knowledge of the matter said. 

The carrier said last month it aims to complete a carveout of the business by the end of the first half before seeking funds from outside investors later in the year. Last year, Nedbank estimated the fintech arm could be worth about $6 billion (R88 billion).  

MTN is studying a variety of potential deals, including bringing in partners for some of its businesses as well as possibly listing certain units in the future, to unlock value and pay down debt. The carrier is also exploring options for its data center business, the people said, asking not to be identified because the information is private. 

The telecom carrier is separately working with FTI Consulting Inc. to find ways to boost revenues from its wholesale business and roaming agreements across the markets where it operates, one of the people said. 

Shares of MTN have roughly doubled in Johannesburg over the past 12 months, giving the company a valuation of about $22.3 billion. Deliberations are ongoing, and there’s no certainty they will lead to any transactions, the people said. 

Spokespeople for MTN, JPMorgan and FTI declined to comment. 

MTN said in 2020 it targets to raise R25 billion from asset disposals over the medium term. It agreed in November to sell a portfolio of wireless towers in its home market of South Africa for R6.4 billion. MTN also has a stake in New York-listed tower owner IHS Holding that it could sell down. 

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
15.77
+0.7%
Rand - Pound
19.69
+0.5%
Rand - Euro
16.65
+0.5%
Rand - Aus dollar
11.10
+0.6%
Rand - Yen
0.12
+0.5%
Gold
1,846.66
0.0%
Silver
21.76
0.0%
Palladium
1,970.00
0.0%
Platinum
958.50
0.0%
Brent Crude
112.55
+0.5%
Top 40
61,000
-1.2%
All Share
67,575
-1.0%
Resource 10
72,529
+1.6%
Industrial 25
72,948
-3.9%
Financial 15
15,746
+0.1%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot