MTN Awaits CBN Approval to Complete 60% Fintech Stake Sale

By Adedapo Adesanya

MTN Nigeria Communications Plc is awaiting regulatory approval from the Central Bank of Nigeria (CBN) to complete the planned transfer of a 60 per cent stake in its fintech businesses to its parent company, MTN Group, before the end of 2026.

The transaction involves MoMo Payment Service Bank Limited (MoMo PSB) and Y’ello Digital Financial Services Limited (YDFS), two businesses within MTN Nigeria’s financial technology portfolio.

The development follows the company’s earlier announcement in April that MTN Group, through its fintech subsidiary, would acquire a 60 per cent stake in both companies for N95.5 billion, as part of a restructuring aimed at reducing MTN Nigeria’s exposure to the loss-making fintech operations.

Under the proposed structure, MTN Nigeria would retain a 40 per cent interest, while MTN Group Fintech would hold 60 per cent.

The company had said the transaction would be implemented in two phases, with the second phase involving the creation of a financial holding company, Fintech HoldCo, which would ultimately own 100 per cent of MoMo PSB and YDFS.

However, the completion of the restructuring is subject to CBN approval, which Business Post gathered is expected to be concluded in the second half of 2026.

The proposed transaction is designed to redistribute the financial and operational risks associated with the fintech businesses between MTN Nigeria and its parent company.

MTN Nigeria had explained that the restructuring would allow MTN Group Fintech to share future capital requirements, losses, regulatory obligations and execution risks associated with the businesses, while MTN Nigeria would maintain a significant minority stake.

The planned investment has an implied value of N152.06 billion in capital injection into the fintech companies, with the N95.5 billion transaction value based on an intra-group debt-free and cash-free valuation.

MoMo PSB operates as a payment service bank, providing services including deposits, payments, transfers and digital wallets to individuals and small businesses through digital and mobile platforms.

YDFS, meanwhile, operates as a licensed super-agent, providing agency banking services such as cash deposits, withdrawals and bill payments through the MoMo network.

MTN’s decision to restructure the businesses comes as the telecommunications company continues to invest heavily in its core connectivity operations amid growing demand for data and digital services.

MTN Nigeria also said it had invested more than N1.6 trillion in network infrastructure since the beginning of 2025, including N620.5 billion in the first half of 2026 alone.

The company’s data business has also expanded significantly, with data revenue rising by 38.4 per cent to N1.70 trillion in the first half of 2026, overtaking voice revenue of N993 billion.

The growth in data services has been supported by a 9.3 per cent increase in active data subscribers to 55.7 million, while smartphone penetration rose to 66.4 per cent.

MTN’s Chief Financial Officer, Mr Modupe Kadri, said the company remained focused on maintaining investment in its core operations while managing cost pressures and strengthening its balance sheet.

The company’s fintech restructuring therefore comes against the backdrop of a broader strategy to optimise its businesses, allocate capital more efficiently and ensure that investments are aligned with areas offering stronger growth prospects.

Once approved by the CBN, the transaction will allow MTN Nigeria to reduce its direct financial exposure to the fintech businesses while retaining a 40 per cent stake and continuing to participate in their future growth.

The company is expected to provide further updates on the transaction as the regulatory approval process progresses, with completion targeted before the end of 2026.