MTN Nigeria cedes 60% of fintech arm to parent group in ₦152 billion restructuring

Key facts

• MTN Nigeria shareholders approved Resolution 9 at the AGM on April 30, 2026, transferring 60% of MoMo PSB and Y'ello Digital Financial Services to MTN Group Fintech B.V.
• The transaction is valued at ₦152.06 billion (approximately $95 million), based on a valuation of ₦95.5 billion (2.1x carrying value as of December 2025).
• MTN Group Fintech will acquire the stake through a hybrid of primary capital injection and secondary share acquisition from MTN Nigeria.
• MTN Nigeria will retain a 40% stake; both parties will place their holdings into a new holding company registered with the Central Bank of Nigeria.
• The fintech subsidiaries are currently loss-making, according to the company.
• The restructuring is part of MTN Group's Ambition 2030 strategy to become Africa's leading connectivity, fintech, and digital infrastructure platform.
• KPMG issued an independent fairness opinion deeming the ₦95.5 billion valuation fair and reasonable.
• Completion is targeted on or before December 31, 2026, subject to regulatory approvals.

Shareholders back landmark transfer of fintech control

Shareholders of MTN Nigeria Communications Plc have approved a sweeping restructuring of the company's digital financial services arm, clearing the way for a ₦152.06 billion transaction that will see the telecom operator cede majority control of its fintech subsidiaries to its parent company. The approval, granted at the Annual General Meeting on April 30, 2026, endorses Resolution 9, which transfers a 60 percent stake in MoMo Payment Service Bank Limited and Y'ello Digital Financial Services Limited to MTN Group Fintech B.V. The move marks a decisive shift in strategy for MTN Nigeria, which has fully funded the fintech businesses to date but now acknowledges that their continued growth requires substantial financial investment beyond its capacity.

A hybrid deal structure with fresh capital and share buyback

Under the arrangement, MTN Group Fintech will inject fresh capital into the two subsidiaries while also acquiring existing shares from MTN Nigeria, combining a primary issuance of new shares with a secondary acquisition. The transaction is based on an agreed valuation of ₦95.5 billion for the fintech entities, which KPMG, acting as independent adviser, has described as fair and reasonable. That valuation represents a 2.1x premium to the carrying value of the businesses as of December 2025. MTN Group Fintech will invest ₦152.06 billion for its 60 percent stake, with the consideration to be settled in cash, assets, or a mix of both, according to the company.

New holding company to be registered with central bank

Following the transaction, both MTN Nigeria and MTN Group Fintech will transfer their respective stakes into a newly created holding company, Fintech HoldCo, which will ultimately own 100 percent of MoMo PSB and Y'ello Digital Financial Services. The holding company is to be registered with the Central Bank of Nigeria, a structure designed to streamline regulatory oversight and enhance the flexibility to attract future strategic partners. MTN Nigeria will retain a 40 percent stake in the holding company, while MTN Group Fintech will hold 60 percent.

Loss-making subsidiaries drive need for parent backing

MTN Nigeria acknowledged that its fintech subsidiaries are currently loss-making, reflecting the capital-intensive nature of building digital payment platforms, including agent networks for deposits, withdrawals, and payments. The company said it has fully funded the fintech operations to date, but their growth trajectory requires financial resources that are more efficiently provided by the group. By reducing its direct exposure, MTN Nigeria expects to free up resources to strengthen its core telecommunications infrastructure, while the fintech arm gains the financial backing needed to accelerate expansion in areas such as rural penetration and merchant acquisition.

Alignment with Ambition 2030 and prior stake consolidation

The restructuring is a key element of MTN Group's Ambition 2030 strategy, which aims to position the group as Africa's leading connectivity, fintech, and digital infrastructure platform. The group had already strengthened its position in MoMo in 2024 by increasing its stake to 100 percent after buying back shares held by a minority investor. the internal reorganization redistributes risks and capital requirements between the parent and its Nigerian subsidiary, allowing each to focus on its respective strengths.

Timeline and next steps toward completion

The transaction is subject to regulatory and legal approvals, with completion targeted on or before December 31, 2026. MTN Nigeria has stated that it will proceed with the required processes following shareholder approval, including engagement with the Central Bank of Nigeria and other relevant authorities. The creation of Fintech HoldCo, which requires central bank approval, represents a critical milestone in the second phase of the restructuring.

A strategic pivot for Nigeria's telecom-finance nexus

The deal underscores the growing financial demands of mobile money operations in Africa's largest economy, where digital payment services are expanding rapidly but remain capital-intensive. By transferring majority ownership to the group, MTN Nigeria is effectively sharing the financial and operational burden of building a digital banking ecosystem while retaining a significant minority stake. The restructuring positions the fintech subsidiaries for potential future investment rounds and partnerships, with the holding company structure providing a cleaner vehicle for external capital.

The bottom line

• MTN Nigeria shareholders approved the sale of a 60% stake in MoMo PSB and Y'ello Digital Financial Services to MTN Group Fintech for ₦152.06 billion.
• The transaction is based on a valuation of ₦95.5 billion, representing 2.1x the carrying value as of December 2025, deemed fair by KPMG.
• MTN Nigeria will retain a 40% stake; both parties will consolidate holdings into a new holding company registered with the Central Bank of Nigeria.
• The fintech subsidiaries are currently loss-making, and the restructuring shifts capital and risk to the parent group.
• The deal aligns with MTN Group's Ambition 2030 strategy to scale digital and financial services across Africa.
• Completion is targeted by December 31, 2026, pending regulatory approvals.