MTN Group Ltd., Africa's largest wireless carrier, said Mastercard Inc. agreed to acquire a minority stake in its fintech business.
The deal will consist of two parts, including a commercial payment and money transfer agreement that uses Mastercard's technology infrastructure to expand in Africa, and an investment in a minority stake, MTN Chief Executive Ralph Mupita said. According to him, the size of the share will be disclosed after the deal is closed.
The announcement comes as Africa's young, tech-savvy population is increasingly using their mobile phones to fill service gaps, including banking. This has opened up a lucrative and fast-growing space in the fintech sector for wireless carriers.
MTN shares rose 9.4% in Johannesburg, the biggest intraday gain in a year.
MTN's latest sales include the sale and leaseback of mobile phone towers in South Africa and a plan to sell some assets in West Africa. She also has a stake in IHS Holding Ltd., a New York-listed company, which she may sell.